Woodward O'Connor Mortgage Associates have helped Californian families finance their dream homes for over twenty years. We understand that obtaining a mortgage is a major financial commitment and our goal is to work closely with you to identify a mortgage that meets your financial objectives. We maintain close communication throughout the process to ensure that your loan application proceeds smoothly and that you obtain the best available rate.

Q: Is there an advantage to using a mortgage broker like Woodward O'Connor instead of going directly to a bank?
A:  As mortgage brokers we offer a wider choice of loan products than any single lending institution. We consult with you to choose a loan that best meets your financial objectives and coordinate all the loan processes including preparing a detailed application and investigating financial and credit worthiness.

Q:  Do you choose lenders based on who offers the best rate?
A:  Rate is an important consideration. In addition, we recommend a lender based on their reputation for service, their underwriting criteria, and their ability to fund a loan on time.

Q:   My realtor has a broker in-house. How do their services compare to an independent mortgage broker?
A:  Brokers in real estate offices are often associated with a single lender. Because we work with a number of lenders we are able to offer a greater choice of mortgage products. In addition, real estate offices have added mortgage brokers to their in-house services fairly recently. Our twenty years of experience can be critical when you have an unusual property or need a quick turnaround on your loan application.

Q:   I regularly receive notices from Internet mortgage companies offering very attractive rates. Are you able to match these rates?
A:  In most cases, yes. In addition to competitive rates, we monitor the loan to ensure the process goes smoothly. We've had a number of clients that explored loans offered by Internet mortgage brokers and returned to us because, while the rate was low, they were continually surprised by additional fees and an inability to close in a prescribed time frame.

Q:   I'm self-employed. Will I be able to qualify for a home mortgage?
A:   We've helped many self-employed people realize their dreams of owning a new home.

Q:  My realtor said it might be difficult to get a loan because the property we are looking at is unusual. Can you help?
A:  Definitely. Because we're familiar with the local real estate market, we often obtain loans on unusual properties, including those at the high end of the market where there are no relevant comparable sales.

Q: What are your fees?
A:  We charge a $15O loan application fee to start the process. All other loan fees are itemized in the Good Faith Estimate that will be provided within three days of when your loan application is accepted. We will be happy to explain the fees to you if you have questions.

Q:   This will be my first home. How can I determine how much house I can afford?
A:   Generally speaking, you can purchase a home with a value of about four times your annual household income. However, the amount you can borrow will depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may be able to take advantage of special loan programs for first time buyers.

Q:  Do you recommend being pre-approved for a loan?
A:  Being pre-approved for a specific loan amount prior to selecting a property makes you a more attractive buyer. With a pre-approval letter in-hand, realtors know that you're serious and represent a good investment of their time. Sellers know you have the ability to make an offer. Local realtors have told us that they know the loan will be approved when we provide the pre-approval.

Q:   How much do I need for a down payment?
A:  A rule of thumb is for the down payment to be equivalent to 20 percent of the home's purchase price, although many lenders now offer loans that require less than 20 percent down. We're glad to explain the options available to you.

Q:  In addition to the down payment, how much cash will I need to purchase a home?
A:  The amount of cash you'll need generally includes the following:
Earnest money—the deposit you provide when you make an offer,
Down payment—a percentage of the cost of the home that is due at settlement,
Closing costs—fees associated with processing the loan paperwork. These fees will be explained at the time the loan is initiated.

Q:  What is the difference between a fixed-rate and an adjustable rate mortgage?
A:  With a fixed-rate mortgage, the interest rate and the monthly payment stay the same throughout the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes, typically in relation to an index. Adjustable-rate loans usually offer a lower initial interest rate than fixed-rate loans.

Q:  How are an index and margin used in an adjustable rate mortgage (ARM)?
A:  An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally the interest rate is a combination of the index rate and a pre-specified margin.

Q:  What is included in my mortgage payment?
A:  Your monthly mortgage payment includes three parts:
Principal—repayment on the amount borrowed,
Interest—payment to the lender for the amount borrowed,
Taxes and insurance—payments made into an escrow account for property taxes and hazard insurance. Optionally, you may pay these fees directly to the tax collector and insurance company.

Q:  Which mortgage is best for me?
A:  A number of factors enter into the choice of a mortgage, including your current financial picture and how long you intend to keep your house. While the "the lowest rate" may sound like the “best mortgage,” a loan with a low interest rate and high fees may not be the best choice for someone with limited cash. We'll help you evaluate your choices and select a loan that matches your financial goals.

Woodward O'Connor Mortgage Associates
4980 Capitola Road, Capitola CA 95010
Ph. 831-479-3303
Fx. 831-479-3307
www.woodwardoconnor.com
loans@woodwardoconnor.com

©2006 Woodward O'Connor Mortgage Associates.
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