Oxford Federal Credit Union - Steps to buy a home

Testimonial - Rates

So you have saved for your down payment and closing costs and you have found the house of your dreams!!

What happens next?

Complete the mortgage application and supply any necessary documents. These usually include:

Proof of Income
Purchase & Sale Agreement
Property Disclosures
Warranty Deed

If your lender requires any other documentation, deliver it to them as quickly as possible!

At application or within 3 days you will receive a Good Faith Estimate (GFE) of settlement costs. This lists the estimate of the charges you will likely pay at closing. You will also receive a Truth in Lending Disclosure (TIL) This will show the APR for your loan plus a list of loan fees and expenses You will also receive consumer information regarding various real estate settlement services and rights and responsibilities of consumer and lender.

When the lender reviews your application they look at several key factors.

Income and employment
Installment and revolving debt
Down payment
Cash available after closing
Type of mortgage product
Interest rate of the mortgage
Length or term of mortgage product.
Credit

The lender then evaluates the Four C’s in deciding whether to make you the loan:

Collateral: The lender will require that you pay for an appraisal of the property to determine its market value compared with other similar properties in the neighborhood. An appraisal helps to prevent the lender from lending you more than the property is worth.
Capacity: Will you be able to repay the mortgage (based on your income and employment history)? Will you also be able to handle your other major debts?
Credit: The lender will look at your credit history to determine how you repay your debts. Do you consistently pay your bills on time or is there a history of late payments? Are there any serious negative items, such as judgments or bankruptcies?
Capital: Do you have enough cash on hand for the down payment and settlement or closing costs? Will there be any cash left over once the closing is completed?

The lender will then initiate the ordering of the appraisal and title search on the property. While waiting for everything to process, you should be completing any home inspections if needed. This may save you a lot of headaches down the road! Shop for your Hazard Insurance. You must have a policy in place and paid in full before closing. While waiting for your mortgage to go thru do not take on any additional debt!

Mexico Office:
225 River Road
PO BOX 252
Mexico, Maine 04257
Phone: 207.369.9976
Fax: 207.364.8962

Norway Office:
54 Fair Street
Norway, Maine 04268
Phone: 207.743.2638
Fax: 207.743.7138

Email: oxford@ofcu.org
Toll-free: 800.991.9219