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1. How do I know how much house I can afford? Answer
2. What is the difference between a fixed-rate loan and an adjustable-rate loan? Answer
3. How is an index and margin used in an ARM? Answer
4. How do I know which type of mortgage is best for me? Answer
5. What does my mortgage payment include? Answer
6. How much cash will I need to purchase a home? Answer

Q : How do I know how much house I can afford?
A : Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make. You may also be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value. Give us a call, and we can help you determine exactly how much you can afford. TAP FCU offers a free pre qualification consultation. To find out more, please contact a mortgage loan officer at 210-469-4663.
 
Q : What is the difference between a fixed-rate loan and an adjustable-rate loan?
A : With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us. For more information and to compare ARMs VS fixed, please contact a mortgage loan officer at 210-469-4663.
 
Q : How is an index and margin used in an ARM?
A : An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally the interest rate that you pay is a combination of the index rate and a pre-specified margin. Three commonly used indices are the One-Year Treasury Bill, the Cost of Funds of the 11th District Federal Home Loan Bank (COFI), and the London InterBank Offering Rate (LIBOR).
 
Q : How do I know which type of mortgage is best for me?
A : There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. Texas Associations of Professionals Federal Credit Union can help you evaluate your choices and help you make the most appropriate decision. Please contact a mortgage loan officer at 210-469-4663 to find out which options will suit your needs best so you can make a good decision on how you want to use your money.
 
Q : What does my mortgage payment include?
A : For most homeowners, the monthly mortgage payments include PITI which stands for principal, interest, taxes and insurance. This makes up your full payment. However, only the principal and interest are actually toward the mortgage loan. Annually your taxes may go up along with homeowner's insurance as your property value also increases. On a fixed rate mortgage the P&I remain constant and on an ARM your P&I may go up. The taxes and insurance are called your escrows and are held in a separate accounting to pay these entities separately from what is called your escrow account. For more information, please contact a mortgage loan officer at 210-469-4663.
 
Q : How much cash will I need to purchase a home?
A : The amount of cash that is necessary depends on a number of items. There are three separate items for cash needed to close. 1. Down payment - which depending on the program selected can vary from product to product. This is actually taken off of the sales price that you have negotiated and you bring these funds to closing. 2. Closing costs - these are 'fees' for services rendered to fulfill your mortgage request, they include origination fees, underwriting, closing fees, appraisal fees, title fees and more. Some of these fees may be negotiated to be paid for by the seller. You'll need to discuss this with your realtor. 3. Escrows - these the deposits held in an escrow account to cover current taxes and insurance for the home. Depending on the month in which you close, this number of months for taxes held will be different. The homeowner insurance will require approximately 14 months collected at closing. For more information please contact a mortgage loan officer at 210-469-4663.