Forced arbitration and hidden clauses
Frequently Asked Questions
Straight answers to the questions we hear most.
A USDA loan is a mortgage backed by the U.S. Department of Agriculture.
Purpose: To promote homeownership in designated rural and suburban areas.
Eligibility Requirements:
Location: The property must be in a USDA-eligible area.
Income: Borrower’s household income cannot exceed certain limits for the area.
Occupancy: The home must be the borrower’s primary residence.
Purpose: To promote homeownership in designated rural and suburban areas.
Eligibility Requirements:
Location: The property must be in a USDA-eligible area.
Income: Borrower’s household income cannot exceed certain limits for the area.
Occupancy: The home must be the borrower’s primary residence.
To calculate your DTI, follow these two steps:
1. Add up all your monthly debt payments. This includes your potential new mortgage payment, auto loans, student loans, minimum credit card payments, personal loans, and any other recurring debt.
2. Divide your total monthly debt by your gross monthly income. Your gross income is your total pay before any taxes or deductions are taken out.
3. Multiply the result by 100 to get a percentage.
Formula: (Total Monthly Debt Payments / Gross Monthly Income) x 100 = DTI%
1. Add up all your monthly debt payments. This includes your potential new mortgage payment, auto loans, student loans, minimum credit card payments, personal loans, and any other recurring debt.
2. Divide your total monthly debt by your gross monthly income. Your gross income is your total pay before any taxes or deductions are taken out.
3. Multiply the result by 100 to get a percentage.
Formula: (Total Monthly Debt Payments / Gross Monthly Income) x 100 = DTI%
A recast is a formal process where, after a significant lump-sum principal payment, your lender re-amortizes the loan, resulting in a lower monthly payment for the remaining term. Making standard extra payments does not change your monthly payment but shortens the loan’s term.
A mortgage rate lock, also known as a rate commitment, is a guarantee from a lender that they will honor a specific interest rate and a set number of points for your mortgage loan for a predetermined period. This protects you from potential rate increases while your loan application is being processed.
You will likely lose any application or processing fees paid to the original lender that are non-refundable. You will also have to pay for a new credit report, a new appraisal, and potentially a new title search.
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