Joe Bydzovsky
Branch Manager
As an experienced loan officer, my goal is to provide you with individual solutions tailored to your specific needs. I review all the details and objectives with you to ensure that everyone is on the same page. I want my customers to remember the smooth process long after the closing is completed. I have access to a large variety of financing options designed to meet the needs of the first-time homebuyer as well as the experienced owner. By providing in-house origination, processing, underwriting and funding services, I can ensure that your loan will be completed accurately, smoothly and in the loan that best meets your needs. This positive experience is why past customers, real estate and financial professionals continue to refer me to friends, family, clients and co-workers. I believe you will too!
Marketplace Approved
There’s a difference between getting pre-approved & getting Marketplace Approved. Our pre-approvals go through certified underwriting up front to give all parties the certainty of closing and closing ON TIME.
5 Day Loan Commitment
Want to make your offer more attractive? Get a complete commitment from underwriting in 5 days with or without a house with our UFirst 5 Day Loan Commitment!
On-Time Closing Guarantee
If we are unable to close your purchase on or before your scheduled closing date, we will pay for your first mortgage payment up to $1,500 P & I AND the seller of the property will also be paid $5,000. *See terms and conditions.
Interest Rates Vs. Affordability
Rising interest rates can make the difference between locking in the home of your dreams today or being locked out tomorrow!
THE MARKETPLACE HOME MORTGAGE BLOG
Understanding Mortgage Terminology
Buying a home can be a confusing process, especially for the first time you do it. There are many terms and acronyms used throughout the transaction that you may not be immediately familiar with. Luckily, when you work with Marketplace Home Mortgage you can always count on your Loan Officer to guide you through the process and answer any questions that you have.
To get a head start on understanding the mortgage process, take a look at the list of mortgage terminology below. By learning more about these words and phrases, you will be better prepared to navigate a mortgage transaction. If you have any questions, never hesitate to reach out to your Marketplace Home Mortgage Loan Officer. Not connected with an MHM Loan Officer yet? Find one in your area and reach out today.
Mortgage Terminology
1003 Form
A commonly used mortgage loan application developed by Fannie Mae. Sometimes called the Uniform Residential Loan Application.
Adjustable Rate Mortgage (ARM)
A type of mortgage loan characterized by interest rates that automatically adjust or fluctuate in concert with certain market indexes. Generally, an ARM begins with an introductory or initial interest rate, which then may rise or fall, but monthly payments may not exceed the ARM loan cap.
Borrower
The individual or individuals extended a loan and mortgage for the purchase of a house and/or property. The borrower is responsible for making all payments and fees associated with the loan over the life of the loan.
Closing
The formally documented sale of a home and/or property that includes signing all documents associated with the exchange and payment of required closing fees. A closing agent usually oversees this process.
Conventional mortgage
A mortgage offered by any one of the Government sponsored entities, different from an FHA or VA loan. These are typically 30-year fixed-rate loans.
Earnest money
A sum of money usually put up by the buyer when an offer on a home or property is made. The purpose of earnest money is as a token of good faith, a symbol that the buyer is seriously pursuing the purchase.
Equity
The measurable value of a home or property above and beyond that owed on a loan. A value upon which many homeowners often borrow.
Escrow
At the closing of the mortgage, the borrowers are generally required to set aside a percentage of the yearly taxes to be held by the lender. Monthly, the lender will also collect additional money to be used to pay the taxes on the home. This escrow account is maintained by the lender who is responsible for sending the tax bills on a regular basis.
FHA Loan
Loans extended by FHA (Federal Housing Administration) approved lenders. These loans are typically are designed to assist borrowers who are unable to get approval for conventional home loans.
Fixed Rate Mortgage
A conventional mortgage that is outfitted with a fixed interest rate over the life of the loan. Monthly payments are the same from month to month.
HUD loan
A type of loan available to HUD homebuyers that goes toward fixing up a home. The loan is subsequently absorbed into the mortgage. The term “HUD loan” is often confused with “FHA loan.”
Jumbo Mortgage
A type of high-risk loan, or non-conforming loan, in which the “jumbo” loan amount is higher than that of a conventional loan limit.
Lender, Mortgage Lender
The bank or finance company that directly awards home loan or mortgage money to a borrower or homebuyer. Legal-mortgagee.
Marketplace Approved®
A pre-approval provided by Marketplace Home Mortgage. When a buyer is Marketplace Approved the underwriting process is completed up front to eliminate surprises at the end. Marketplace Approved offers are also enhanced by an On-Time Closing Guarantee*. If we are unable to close your purchase on or before your scheduled closing date, we will pay your first mortgage payment up to $1,500 P&I and the seller of the property will also be paid $5,000.
Mortgage Broker
The entity that acts as a go-between between a homebuyer and mortgage lender, handling paperwork and finally effecting a mortgage. A broker does not make direct loans to buyers but works to find the best deal and finally collects fees as part of the mortgage process.
Mortgage Insurance
When buyers take out a mortgage with less than a certain dollar percentage to put down on the loan, lenders sometimes require mortgage insurance, a monthly premium that is added to the mortgage. This protects the lender should a buyer default on the home loan.
Mortgage Insurance Premium, MIP
A required fee added into an FHA loan paid at closing.
Preferred Lender
A lender that is closely affiliated with a brokerage based on reputation and other industry factors. A mortgage lender that is recommended by a broker. Marketplace Home Mortgage is the Preferred Lender of many brokerages across the US.
Pre-Approval & Pre-Qualification
Pre-qualification is the process by which a homebuyer may find out how much of a home loan he or she would be approved for with a lender. This is usually just an estimate based on preliminary information concerning income, debts, assets. A pre-approval, on the other hand, is a stronger, more reliable evaluation of necessary documentation. At Marketplace Home Mortgage our clients are pre-approved (Marketplace Approved®) by a certified underwriter to ensure that they know how much they can really afford, eliminating problems later on.
Private mortgage insurance, PMI
A type of insurance many homebuyers are required to purchase, particularly when they are unable to put down a certain dollar amount on the loan; protects the lender in the event of borrower default.
Property appraisal
A fair market value of property performed by a licensed appraiser; takes into account not only condition, but also the value of similar local properties or comparable sales.
Rate Lock
A short-term agreement by a lender to “hold” a certain interest rate on a home loan while the buyer negotiates a sale transaction. Also, Rate commitment option.
Real Estate Settlement Procedures Act (RESPA)
This act passed in 1974 reeled in hidden costs, fees and kickbacks that had become widespread among real estate entities. Per this act, all fees and costs must be disclosed to both buyers and sellers.
Refinance
The process by which a borrower/homeowner may negotiate a lower interest rate on a mortgage, thereby lowering monthly payments. They may choose to work with their current lender or refinance with another lender.
Reverse Mortgage
A type of mortgage designed for homeowners over 62 years of age; gives them access to home’s equity in cash payments. Frees up money they may use for other important costs or to make needed home repairs. Since reverse mortgages are typically structured as loans, these payments are not typically considered income.
Sub-Prime Loan
a high-risk loan packaged with non-conforming loan limits and interest rates that make it possible for homebuyers with poor credit to qualify for a mortgage.
Title Company
A title company typically handles all tasks associated with the property title, including insurance and search.
Title Insurance
Insurance taken out on the property title that protects both borrower and lender in the event of a title dispute.
Underwriter
The company or service that evaluates a borrower’s creditworthiness prior to loan and mortgage approval.
VA Loans
Special, often discounted, home loans designed exclusively for military veterans.
These terms and definitions were compiled from the Mortgage Calculator.
“Glossary of Mortgage Terms.” Mortgage Calculator, www.mortgagecalculator.org/helpful-advice/glossary.php.
No Down Payment & Low Down Payment Mortgage Options
One of the biggest perceived obstacles to homeownership today is the mortgage down payment.
According to the National Association of Realtors, 80% of home buyers think they need 10% or more down to buy a home – and that is simply not the case! (NAR, 2017) There are many programs out there that range from ZERO to 3% down, here are some of the options available to both first-time and repeat buyers:
USDA HOME LOAN / RURAL DEVELOPMENT – ZERO DOWN PAYMENT
Anyone looking outside of the metro should consider this loan. With ZERO money down, low rates, and no mortgage insurance, the affordability of a USDA loan is almost unmatched in the mortgage market. Home buyers must make 115% or less than the area’s median income. Example: If the median income is $50,000 per year you can make up to $60,500. To see if an area you’re interested in is eligible click here.
VA HOME LOAN – ZERO DOWN PAYMENT
This is a ZERO down mortgage option for home buyers with current or former military service. It is often the top choice for those eligible because it offers 100% financing and does not require great credit. With no monthly mortgage insurance, and low rates, this is often the best loan option for members of the military and National Guard.
FHA HOME LOAN – 3.5% DOWN PAYMENT
About 40% of home buyers under 40 use FHA loans. This loan is best for those who don’t want to put a lot down, but still want great rates and flexible credit requirements. The down payment required is 3.5% AND 100% of the down payment can be a “gift” from family or friends.
HOMEREADY HOME LOAN – 1-3% DOWN PAYMENT
This loan considers the income of everyone living in the house as part of the qualification process – this includes people who rent from you, parents, or children. For eligible buyers, it could be possible to get into the home you have your eye on for as little as a 1% – 3% down payment.
Although lower down payments generally have restrictions of some kind (like mortgage insurance or location-based eligibility), it is still reassuring to realize that you have options other than a conventional loan. Even if you don’t qualify for 100% financing or don’t have enough for 3.5% down, down payment assistance is also available. If you want more information or would like to see if you qualify for any of the loans mentioned above, get started today! If you are not already connected with a Marketplace Loan Officer, we will put someone in touch who can help you understand and weigh your options.
Source: “NAR 2017 – Research and Statistics.”, The National Association of Realtors, 7 June 2018, www.nar.realtor/research-and-statistics.
USDA Announces New Income Limits in Minnesota
On Wednesday, June 13th, new income limits went into effect for USDA loans in Minnesota. These household income limits vary by region and help determine eligibility for rural development home loans. There are many benefits to USDA loans, the most notable being that they don’t require a down payment. You also may be surprised to discover where they are available.
To learn more about the new limits in your area and what they mean for home buyers, contact a Marketplace Home Mortgage Loan Officer today.
Source: www.RD.USDA.COM/MN
*Data for 1-4 person households