Question 1

How do I know if I’m ready to buy a home?

Accepted Answer

If you can answer “yes” to these questions, you are probably ready to buy your own home. Use our simple Mortgage Calculators to determine the size of mortgage you can afford.

Question 2

Are there special mortgages for first-time homebuyers?

Accepted Answer

Yes. We offer several affordable mortgage options which can help first-time homebuyers overcome obstacles that made purchasing a home difficult in the past. Lenders may now be able to help borrowers who don’t have a lot of money saved for the down payment and closing costs, have no or poor credit history, have quite a bit of long-term debt, or have experienced income irregularities. Learn more by visiting our mortgage page.

Question 3

What do I need to take with me when I apply for a mortgage?

Accepted Answer

If you have everything with you when you visit with us, you’ll save a good deal of time. You should have:

Question 4

How do you determine the maximum loan amount that you can afford?

Accepted Answer

According to general calculations, your mortgage payments should be no more than 29% of gross income. The mortgage payment, combined with non-housing expenses, should total no more than 41% of income (however, depending on your specific loan scenario, you may qualify with a combined debt to income ratio as high as 50%).To assess maximum loan amount, one of the factors we consider is your debt-to-income ratio. This is a comparison of your gross (pre-tax) income to housing and non-housing expenses. Non-housing expenses include long-term debts like car or student loan or credit card payments, alimony, or child support. We also consider the amount of cash you have available for down payment and closing costs and your credit history.

Question 5

How large does my down payment need to be?

Accepted Answer

When considering the size of your down payment, consider that you’ll also need money for closing costs, moving expenses, and possibly, repairs and decorating. There are mortgage options now available that only require a down payment of 3% or less of the purchase price. The larger the down payment, the less you have to borrow, and the more equity you’ll have. Mortgages with less than a 20% down payment generally require a mortgage insurance policy, called Private Mortgage Insurance (PMI), to secure the loan.

Question 6

How much money will I have to come up with to buy a home?

Accepted Answer

This expense depends on a number of factors, not just the cost of the house and the type of mortgage you would like. You should plan to come up with enough money to cover three costs: earnest money – the deposit you make on the home when you submit your offer (to prove to the seller that you are serious about wanting to buy the house), the down payment (a percentage of the cost of the home that you must pay when you go to settlement), and closing costs (the costs associated with processing the paperwork to buy a house.) You will pay the closing costs at settlement. This amount averages 3-4% of the price of your home. These costs cover various fees and processing expenses. When you apply for your loan, we will give you an estimate of the closing costs, so you won’t be caught by surprise.

Question 7

What is "loan to value" (LTV) and how does it determine the size of my loan?

Accepted Answer

The loan to value ratio is the amount of money you borrow compared with the price or appraised value of the home you are purchasing. Each loan has a specific LTV limit. For example: With a 95% LTV loan on a home priced at $50,000, you could borrow up to $47,500 (95% of $50,000), and would have to pay,$2,500 as a down payment. The LTV ratio reflects the amount of equity borrowers have in their homes. The higher the LTV the less cash home buyers are required to pay out of their own funds. To protect lenders against potential loss in case of default, higher LTV loans (80% or more) usually require a mortgage insurance policy.

Question 8

What is PMI?

Accepted Answer

PMI stands for Private Mortgage Insurance or Insurer. These are privately-owned companies that provide mortgage insurance. They offer both standard and special affordable programs for borrowers. These companies provide guidelines to lenders that detail the types of loans they will insure. Lenders use these guidelines to determine borrower eligibility. PMI’s usually have stricter qualifying ratios and larger down payment requirements than the FHA, but their premiums are often lower, and they insure loans that exceed the FHA limit.

Stock Yards Bank & Trust

Brock Murphy

Mortgage Loan Officer

Contact Details

Mortgage Offering

Areas Served

Meet Brock Murphy

Mortgage Loans

Apply for a Mortgage Loan Today

Workshops & Seminars

HomeView Homebuyer Course

Frequently Asked Questions

Brock Murphy Reviews