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Home Loans: What They Are & How To Get Preapproved For A Home Loan

Whether you’re a seasoned or first-time homebuyer, purchasing a home is a major life event. With a home loan from Central Bank, you have a mortgage officer who will provide the unparalleled service you expect to answer questions and provide support throughout the duration of your loan. If you’re interested in applying for a home loan through Central Bank, you can submit an application below, or continue reading for more information about the types of mortgages Central Bank offers.

 

What Is A Conventional Home Loan?

A conventional home loan is the most common type of mortgage available through private lenders such as Central Bank. These types of loans are not offered or secured by a government entity, and they have a fixed rate of interest, meaning the interest rate does not change during the life of the loan.

To apply for a conventional loan, potential borrowers must complete an application and supply the lender with documentation to check on credit history and credit score. Though conventional mortgages are a common type of home loan, they aren’t all the same and have differences to meet your needs.

Types Of Home Loans

Whether you have a long mortgage history or are a first-time homebuyer, there are an array of home loan types to meet your financial needs and goals.

Fixed Rate Mortgage

Fixed-rate mortgages are a type of home loan in which the interest rate and monthly payment remain the same for the life of the loan. This type of loan is recommended for borrowers who want a stable interest rate that does not fluctuate with market conditions or who tend to own property long term. An advantage of fixed-rate mortgages is that borrowers will potentially pay less than current market conditions if interest rates rise, whereas a disadvantage is they will pay more if interest rates drop.

Adjustable Rate Mortgage

Adjustable-rate mortgages are home loans that have a fixed interest rate for a period of time, then begin to fluctuate based on specific benchmarks or indexes. Adjustable-rate mortgages are beneficial if you plan to keep the loan for a limited amount of time and can financially handle any rate increases. However, it can be difficult to budget when payments fluctuate or if interest rates drastically spike.

Specialty Home Loans

There are several other types of home loans designed for potential homeowners with specific characteristics, such as first-time homebuyers or veterans. The two most common specialty loans are Federal Housing Administration (FHA) loans and Veterans Affairs (VA) loans. FHA loans allow homebuyers of all income levels to purchase a home with a lower down payment, and are a great option for first-time homebuyers. VA loans provide qualified veterans, reservists, active duty personnel or eligible family members with loans in a wide range of rate, term and cost options. Though FHA and VA loans are the most common specialty loan types, Central Bank also offers USDA Rural Community and Fannie Mae loan options for borrowers in unique situations.

Do I Qualify For A Home Loan?

Qualifying for a home loan depends on a number of factors, including your income, debt, credit score, assets and property type. The best way to find out what type of loan you qualify for is by filling out a mortgage application. Use Central Bank’s mortgage calculator to generate an amortization schedule for your current mortgage and see how much interest you’ll pay. To calculate monthly payments, compare lending scenarios and apply for a mortgage from your phone, download the Central Bank Home Loans app.

How to Get Preapproved For a Home Loan At Central Bank

Before you apply for a home loan, it’s important to gather your financial documents. The exact documents you need depend on a variety of factors, such as being self-employed versus employed by a company. However, these are the most common types of information you might need when applying for a home loan:

Expenses & Liabilities

Expenses and liabilities include anything that you owe to another person or institution. This could include auto or student loans, credit card balances or other personal loans.

Investment & Liquid Assets

Investment assets include both tangible and intangible items which investors buy and sell to generate additional income on a short or long-term basis. Liquid assets are a type of investment asset that includes readily-accessible items such as cash, or items that can quickly be converted to cash, such as stocks, bonds and mutual funds.

Employment Information

You’ll need to provide current and past employment information, particularly if you’ve been employed in your current position for less than two years. If you’re self-employed, you may need to provide additional documentation as well.

Gross Income

To ensure you can afford your loan, you’ll need to provide your gross monthly income before any deductions for tax, child support, social security, 401(k), etc.

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Interested In Getting A Home Loan Through Central Bank? Let’s Get Started!

Purchasing a home is an exciting decision in a person’s life, and with Central Bank, you have a mortgage officer to provide support every step of the way. Visit our lenders or locations pages to get in touch with one of our mortgage lenders, or fill out an application online today.

Central Bank Home Loans App

Calculate monthly payments, compare lending scenarios, apply using your smartphone...and much more! Enter your cell phone number to download our home loans app: 
 
     
     
     
     
     
     
     
     
     
     

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