Page 33 - Valley Life & Health

THE MORNING CALL SATURDAY, APRIL 27, 2019 33

GETTI
GETTING A MORTGAGENG A MORTGAGE

DOESN’T HAVE TO BEDOESN’T HAVE TO BE
COMPLEX OR CONFUSINGCOMPLEX OR CONFUSING

Embassy Bank’s Uncommon Mortgage ®
offers a unique way to buy or refinance

By Shannon Sigafoos of The Morning Call

et’s face it – making the leap to home ownership Bank, these costs can be lowered by applying for One of the other ‘hidden costs’ that borrowers
®
is a big step, and one that should be taken with their ‘Uncommon Mortgage .’ need to be aware of when it comes to mortgages
L careful consideration. Many of us have probably “Not only does the Uncommon Mortgage have no is the prepayment penalty. It’s usually either quickly
encountered confusing jargon like ‘PMI,’ ‘underwriting,’ application fees, but all of the closing costs are minimal. glossed over or not brought up at all – and while those
‘points,’ or ‘prequalification,’ and trying to make sense Whether it’s a home purchase or our fantastic refinance who are financially responsible may think that it’s smart
of everything leaves us on the verge of frustration. special for only $525 total, our clients save. We can to pay off your mortgage early, it could actually hurt
There are traditionally six steps to a common do this because we are a local lender,” says Jennifer you in the long run with a traditional mortgage.
mortgage approval process: Tropeano, Embassy Bank’s SVP of Consumer Lending. A prepayment penalty is an agreement between
The Pre-Approval: When a lender reviews “Everything is handled in-house right here in the Lehigh the borrower and the mortgage lender that regulates
your financial situation to determine if you’re a good Valley, which eliminates the heavy overhead costs what the borrower is allowed to pay off, and when.
candidate for a loan. that our competitors must cover. Not only do our Most lenders allow borrowers to pay off up to 20
Housing Hunting/Purchase Agreement: Primarily borrowers save upfront with super-low closing costs, percent of the loan balance each year. At Embassy
done by the buyers and their real estate agents. but they can also save with easy biweekly payments, Bank, there is no 20 percent rule in place.
Loan Application: When you’ve found a home & which shorten the length of the loan and can save them “We do not want to penalize anyone for their
made an offer to buy it, the seller has accepted your big dollars in interest over time.” success. Borrowers can pay principal on their
offer, and the application asks for information about One of the things that is most difficult for home mortgage at any time and in any amount with no
the property being purchased, the type of loan being buyers – particularly first-time home buyers – is that penalty,” says Tropeano. “In fact, our borrowers have a
used, and information about you, the borrower. a 20 percent down payment is recommended. While one-time option to have their payments recalculated if
Mortgage Processing: Processors collect a variety it’s not ‘wrong’ to have a smaller down payment, they make a substantial principal payment.”
of documents relating to the borrower and the the biggest drawback is the need for costly private Many homeowners are also used to making
property being purchased, and then review the file mortgage insurance (PMI). This insurance protects the monthly payments of an amount that is determined
to ensure it contains bank statements, tax records, lender in case the home buyer ends up in foreclosure, at closing. But the Uncommon Mortgage allows
employment letters, the purchase agreement, and all but is an added expense for the borrower. Once borrowers to make biweekly payments on the 25-
information needed for the underwriting process. you’ve paid 20 percent of your home’s loan-to-value year mortgage, where half a payment is made every
Underwriting: The underwriter closely examines ratio, you can contact your lender about removing PMI two weeks, 26 times a year. Making those two extra
all of the loan documents to make sure they comply from your mortgage payment, but this isn’t something payments each year allows borrowers to pay down
with lending requirements and guidelines. that goes away automatically. their loan faster, build equity in their home and save
®
Loan Approval/Closing: If the mortgage With Embassy Bank’s Uncommon Mortgage , money in interest over the term of the loan.
underwriter agrees that all guidelines and there is no PMI and no escrow (a monthly payment None of this would be possible without
requirements have been met, they will agree that the added to your mortgage and analyzed once a year to Embassy being a local lender and agreeing to
loan can be funded. All supporting documents are sent cover any increases in taxes or insurance premiums). never sell loans on the secondary market. This
to a title company, and the home buyers and sellers “Because we keep and service every mortgage, streamlines the process, keeps the paperwork
must meet to sign all of the documents. we can create loan products that benefit both the light, and connect buyers with one lender they
Put that way, it sounds simple, right? But customer and the bank. That’s why we decided work with from start to finish.
mortgages typically come with a lot of paperwork to not require PMI on any of our loans – with as “It’s all done locally by people who live and work
to navigate – and that paperwork often comes with little as ten percent down,” says Tropeano. “This right here in the Lehigh Valley. Our settlements are
unexpected fees. These could include everything greatly reduces the borrower’s down payment, their quick and easy – for a home purchase, it’s only seven
from appraisal fees to home inspection fees, credit upfront costs and monthly mortgage payments. Our documents,” Tropeano points out. “And because the
report fees, document preparation fees, loan borrowers put their money toward paying off their loan is never sold, we are here for our customers long
origination fees, and closing costs. But at Embassy loan, and not to the insurance company.” after the settlement for all of their banking needs.”