Boise Home Loan Basics | General Home Loan Informaiton for Boise, Idaho

Home Loan Basics

What is a Mortgage Loan?

A mortgage loan can be obtained by a home buyer or builder from a bank or other intermediary such as a mortgage broker to purchase a home or piece of property. The loan is secured by the real property through the use of a mortgage note which shows the existence of the loan and the encumbrance of that property. A lender or bank will loan the principle capital to secure the property for the borrower to be paid back over time. Mortgages have a principle balance as well as an interest rate which typically reflects the lenders risk which is then amortized usually over a 30 year period. This period can vary based on the type of loan that suits the borrower’s situation and can have many different guidelines for repayment and qualification. During this period the home buyer or borrower will repay the principle investment with the interest to their lender as well as any other escrow fees that may be required by the lender to secure and insure the loan.

Who can get a loan?

There are many factors in finding out if you can qualify for a loan. Typically the bank or lender will have a set list of guidelines in which they must verify your specific financial information to find out if you are a qualified borrower. In general they will be looking at your Income, Loan to Value ratio (Total amount of the loan divided buy the value of the property being secured), Debt to Income ratio (the amount of your consumer debt divided by your income), Credit history and other factors in order to determine if you will have the ability to repay the loan over the set period of the loan. If you are interested in buying or refinancing a home, it is important to speak with a preferred loan specialist to find out exactly what loan type you can qualify for.