1. What should I understand about mortgage loans - Learn about interest rates, buying points, origination fees, and how your monthly payment is determined.  read more...
  2. How will you evaluate my mortgage application - Take a closer look at what factors ARC will use to approve my mortgage.  read more...
  3. How do I estimate how much I can borrow - Get a pre-approval from ARC or use our calculator to get an estimate.  read more...
  4. How do I find the right home for me - Evaluate your priorities before you begin your home search.  learn more... 
  5. How can I decide if refinancing is right for me - Consider these issues to if you are considering refinancing your mortgage.  read more...
  6. Am I ready to buy my first home - While owning a home has some wonderful advantages, it is one of the largest purchases most people make.  Knowing what to expect as a homebuyer can help you make sound financial decisions.  read more...

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1. What should I understand about mortgage loans       back to top

Knowing what to expect when getting a home loan can make finding and financing a home an exciting and rewarding experience. If you obtain a mortgage to help buy your home you will repay more than you borrowed. In addition to your interest rate, term and loan amount, how much you repay is determined by several factors. Here are the components you need to know:

Interest rate
  • The interest rate is the percentage of your loan amount we charge you to borrow money to buy your home.
  • Interest rates are based on current market conditions, your credit score, down payment, and the type of mortgage you choose. Check Our Rates
Discount points
  • One point equals 1% of your mortgage amount.
  • If you qualify, you may be able to pay one or more points to lower your interest rate. A lower interest rate means lower monthly mortgage payments.
  • You may be able to finance points as part of your mortgage amount.
  • Points are usually tax deductible. (Consult a tax advisor on the deductibility of interest.)
  • Learn a little more about points
Origination charge
  • The amount that includes all charges (other than discount points) that all loan originators (lenders and brokers) involved will receive for originating the loan.
  • This charge covers items including fees, document preparation, underwriting costs, and other expenses.
Loan term
  • Your loan term is the amount of time you have to pay off your mortgage balance.
  • Shorter loan terms typically mean higher monthly mortgage payments, but often have lower interest rates. And if you pay off your mortgage balance within a shorter term, you may pay less in total interest than with a longer-term mortgage.

Remember that interest rates only tell part of the story. The total cost of a mortgage is reflected by the interest rate, discount points, and origination charges. This total cost is known as the annual percentage rate (APR), which is typically higher than the interest rate. The APR enables you to compare mortgages of the same dollar amount by considering their total annual cost.

Principal, Interest, Taxes, and Insurance (PITI)

Your monthly mortgage payment is typically made up of four parts:

  • Principal is the amount of money you borrowed.
  • Interest is the cost of borrowing the money.
  • Taxes are the property taxes charged by your local government. Typically we collect a portion of these taxes in every mortgage payment and hold the funds in an escrow account for tax payments made on your behalf as they become due.
  • Insurance refers to homeowners or hazard insurance that provides protection against property damage due to wind, fire or other risks. Like taxes, insurance costs are typically collected and paid from an escrow account.
  • Estimate the payments on your mortgage by using our PITI Calculator.

Depending upon your property location, property type and loan amount, you may incur other monthly or annual expenses such as mortgage insurance, flood insurance, and homeowners association fees.

2. How will ARC evaluate my mortgage application       back to top

When your application is complete, we review the following four components:

Income:

  • Do you have a reliable, continuing source of income to make monthly payments?
  • Income can come from primary, second, and part-time jobs, as well as overtime, bonuses, and commissions.
  • You may use other sources of income if you want them considered for payment – including retirement or veteran's benefits, disability payments, alimony, child support, and rental or investment income – provided they can be verified as stable, reliable, and likely to continue for at least three years.

Current debts and credit history:

  • Do you pay your bills, loans, credit cards and other debts on time?
  • We examine your payment habits before deciding to loan you money.
  • Your credit history and credit score are also examined prior to deciding to loan you money.
  • It's a good idea to check your credit history and correct any problems before applying.

Assets and available funds:

  • Do you have enough funds for a down payment and closing costs?
  • You may use funds from a savings account, certificate of deposit (CD), investments, and retirement fund.
  • In some cases, you may be able to use a gift from a relative, friend, or employer.
  • In many cases you will also have to demonstrate that you have additional funds in your accounts to cover several months of mortgage, tax, and insurance payments.

The property:

  • What is the market value of the property you want to purchase?
  • An appraisal will be ordered to make sure your property's value meets our underwriting requirements.

Responsible lending guidelines

We approve applications where we believe the borrower has the ability to repay the loan or line of credit according to its terms. We use two ratio-based guidelines to evaluate your ability to repay.

Debt-to-income ratio: Housing-expense-to-income ratio:
  • Your expected monthly mortgage payment (principal, interest, taxes, and insurance) plus your other monthly debt obligations to your gross (pre-tax) monthly income are compared.
  • Mortgage program guidelines vary, but a good rule of thumb is to keep your total debt level at or below 36% of your gross monthly income.
  • We also compare just your expected monthly mortgage payment (including taxes and insurance) to your gross monthly income.
  • Mortgage program guidelines vary, but a good rule of thumb is to keep your housing expense level at or below 28%.

Calculate Your Ratios

Even if you fall within the 28%/36% rules of thumb, make certain that you feel comfortable making your monthly mortgage, insurance and tax payments and the payments on all your other monthly obligations. Homes have other costs—such as utilities, maintenance and repairs—that may not exist if you rent.

3. How do I estimate how much I can borrow       back to top

We offer different ways to find out how much you may be able to borrow. When you know how much you expect to borrow, you will have a price range before you begin looking for a home.

  • Use our Mortgage Qualifier to obtain an estimate on how much home you can afford.
  • A Free mortgage prequalification lets you know roughly how much you can borrow, based on basic financial data you provide.  Contact an ARC Mortgage Specialist.
  • A prequalificatioin letter tells a realtor and seller that you've been qualified for a specific amount based on a preliminary review of your credit information. Contact an ARC Mortgage Specialist to get started.

4. How do find the right home for me       back to top

View our comprehensive Home Buyer's Guide

When you are ready to look for your first home, you can receive valuable information and assistance by working with a real estate agent to locate properties for sale that meet your needs. You may want to keep these basic steps in mind:

Preparation
  • Make sure your finances are "in line." Your credit rating is a extremely important factor in your ability to get a mortgage. Be sure you know how much you are willing to afford monthly - before you hear how much you are "qualified" for.
  • If you aren't already working with a real estate agent, your home mortgage consultant can provide you with information to contact real estate agents in your area. Real estate agents make it their business to know about communities and the homes within them.
Location
  • Location is as important as appearance or size.
  • Do you need to be in a particular school district, close to a job, public transportation, or day-care facility?
  • Although no one can predict the rise and fall of property values, talk with your real estate agent about the trends in the area's purchase prices over the years.
Needs and wants
  • Consider desired features and amenities of your new home. For example:
    • How many bedrooms and baths do you need?
    • Do you need central heating or air conditioning?
  • Separate "wants" from "needs" and prioritize your list.
  • Prioritize each item and look for a home with the most important features.
Types of homes
  • A single-family home is just one of your options.
  • Condominiums, town homes, and co-ops all offer different lifestyle and ownership features.
    • Be sure you budget for monthly fees for garbage and snow removal, landscaping, and similar services charged by these communities.

Benefits of working with a REALTOR®

Not every real estate agent is a REALTOR®. What's the difference? According to the NATIONAL ASSOCIATION of REALTORS®, the term REALTOR® identifies a real estate professional who is a member of the association, and who subscribes to its strict Code of Ethics. Some of the benefits of working with a REALTOR® include:

Professional assistance and representation
  • Whether you're buying or selling, a REALTOR® may be able to help you navigate the transaction more smoothly.
  • These trained professionals can make suggestions about what may seem like a complicated process.
Marketplace experience
  • A REALTOR® can assess the market — house-by-house, street-by-street — with access to up-to-date information that you may not have.
Buyer's advantage
  • A REALTOR® who understands your property and location needs can use his or her network to gather first-hand information on upcoming homes for sale.
Seller's advantage
  • Selling your home is a huge undertaking, especially when it comes to accurate pricing and bringing in qualified buyers. You may benefit from seeking the assistance of an experienced REALTOR®

5. How can I decide if refinancing is right for me       back to top

Before you decide to refinance to repay your loan faster, consider the following so that you make a well-informed decision:

What are the estimated costs?
  • Discount Points to lower your interest rate further, which may be tax deductible. (Consult your tax advisor on the deductibility of interest.).
  • Origination Charges such as title search and appraisal.
Does my loan have prepayment penalties?
  • If there's a penalty for early payment of your current loan, this will add to the refinance cost.
How long will I stay in my home?
  • If you plan on staying in your current home for an extended period of time, and the interest rates are 1/2% to 5/8% lower than your current rate, refinancing may be the right choice for you.
How can I determine the break-even point?

6. Am I ready to buy my first home       back to top

When buying your first home, you may have questions and concerns. We understand and are here to help.

Does it make financial sense to buy?  Find out with our Rent vs. Buy Calculator

You may want to think about the following considerations before buying your first home:

  • Added financial responsibility. You will need to pay for utilities, maintenance and repairs. That's on top of your mortgage payments, property taxes and homeowners insurance.
  • Potential risk. Real estate often increases in value over time, but not always. Your property value can also go down.
  • Tighter ties. As a renter, you can pick up and move with short notice. When you own a home, selling it before moving on is more complicated.

While owning a home has some wonderful advantages, it is one of the largest purchases most people make. Knowing what to expect as a homebuyer can help you make sound financial decisions.

 
  1. 30-Year Conventional Mortgage - This typical mortgage is a good fit for buyers with the ability to put at least 5% down, who also want the benefit of a lower monthly payment through a 30-year term.  view details...
  2. 15-Year Conventional Mortgage - This typical mortgage works best with borrowers who have the financial ability to pay at least 5% down plus pay a higher monthly payment, reducing the loan term to 15 years. view details...
  3. FHA Mortgage (coming soon)- This government backed loan has the benefits of a lower down payment (3.5%) and a 30-year term but includes tight restrictions on the condition of the purchasing house.  view details...
  4. Fixed Rate Home Equity Loan - This loan has benefits of a fixed rate plus very low closing costs but can't be used for a new home purchase.  view details...
  5. Home Equity Line-of-Credit - This line-of-credit has low closing costs and allows the borrower to make subsequent advances in the future without reapplying.  A great option for home remodeling.  view details...

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1. 30-Year Fixed Rate Conventional Mortgage       back to top

Is it right for me?

  • Do you plan to stay in your home for many years?
  • Do you prefer a consistent mortgage payment for budget planning?
  • Does your peace of mind depend on a payment that never changes?

If you answered yes to any of these questions, a 30-year fixed might be right for you! Since your rate won't change for the life of your loan, your payment will never increase.

Features

  • 30-, 25-, 20- are all available with fixed rates
  • Refinance up to 95% of your primary home's value
  • Buy a home with as little as 5% down (primary home)
  • Loan amounts from $25,000 to $2,000,000
  • Click Here for current rate

Benefits

  • Monthly payments based on interest rate, principal loan amount, and amortized interest over 30 years
  • Your payment will not change throughout the life of the loan
  • Your actual payment will vary based on your situation and the current interest rates when you apply
  • Pay your mortgage at any time without pre-payment penalties

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2. 15-Year Fixed Rate Conventional Mortgage       back to top

Is it right for me?

Mortgage Rates on the 15 Year Fixed Fall to Decades Low

  • Do you want to pay less interest over the course of your loan?
  • Do you want the security of a consistent rate and payment?
  • Do you want to pay off your mortgage as fast as possible?

If you answered "Yes" to any of these questions our 15-year fixed loan, might be right for you! Lower rates and a shorter term means less interest overall, making this loan a top choice for the financially savvy.

Features

  • 15- and 10-year terms are all available with fixed rates
  • Refinance up to 95% of your primary home's value
  • Buy a home with as little as 5% down (primary home)
  • Click Here for current rate

Benefits

  • Monthly payments based on interest rate, principal loan amount, and amortized interest over 15 years
  • Your payment will not change throughout the life of the loan
  • Your actual payment will vary based on your situation and the current interest rates when you apply
  • Pay your mortgage at any time without pre-payment penalties

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3. FHA Loan       back to top

Is it right for me?

  • Do you need less stringent qualification and credit requirements?
  • Is your down payment or home equity less than 20%?
  • Do you prefer the security of a government-insured loan?
If you answered yes to any of these questions, an FHA loan may be right for you! The easiest way to qualify for refinancing or home buying, an FHA gives you a government-insured loan with flexible choices – opt for the security of a fixed rate or the versatility of an FHA 5-year ARM.

Features

  • 30-, 25-, 20- and 15-year terms are all available with fixed rates
  • Credit scores as low as 620 may qualify
  • 5-year adjustable-rate mortgage available
  • Refinance up to 97.75% of your primary home's value
  • Buy a home with as little as 3.5% down (primary home)
  • Click Here for current rate

Benefits

  • Your actual payment will vary based on your situation and the current interest rates when you apply
  • Pay your mortgage at any time without pre-payment penalties

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Coming Soon But Currently Not Offered - VA Loan       back to top

Is it right for me?

If You've Served Your Country. VA Loans are a Benefit You've Earned.

  • Are you a veteran, member of the military, or a surviving spouse of a veteran?
  • Do you want fast approval and minimal red tape?
  • Are you interested in refinancing up to 100% of your home, or buying a home with no down payment?

How it works

  • 30-, 20- & 15-year fixed-rate and 5-year ARM loans available
  • Jumbo VA loans available up to $1,094,625 and up to $325,000 cash-out on a refinance
  • Credit Scores as low as 620 qualify for VA loans
  • Refinance up to 100% of your primary home's value
  • Buy a home with no money down (primary home)
  • No monthly PMI (Private Mortgage Insurance)
  • VA loans are governed by the U.S. Department of Veterans Affairs

Benefits

  • Fixed rate monthly payments are based on interest rate, principal loan amount and amortized interest over 15, 20 or 30 years. Your payment will not change throughout the life of the loan
  • ARM interest rates are fixed for a period of 5 years. After the fixed rate period, your interest rate can adjust up or down depending on the market
  • Your actual payment will vary based on your situation and the current interest rates when you apply
  • Pay your mortgage at any time without pre-payment penalties
  • Click Here for current rate

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4. Fixed Rate Home Equity Loan       back to top

Is it right for me?

  • Do you need to refinance your existing mortgage?
  • Do you want to avoid the high closing costs associated with a mortgage refinance?
  • Does your peace of mind depend on a payment that never changes?

If you answered yes to any of these questions, an ARC Fixed Rate Home Equity Loan might be right for you! Avoid the cost and time involved with a traditional mortgage refinance.

Features

  • 20-, 15-, 10-, 5- and 3-year terms are all available with fixed rates
  • Refinance up to 80% of your primary home's value
  • Finance as little as $10,000
  • Click Here for current rate

Benefits

  • Your payment will not change throughout the life of the loan
  • Minimal closing costs
  • Quick closings

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5. Home Equity Line-of-Credit       back to top

Is it right for me?

  • Do you need to refinance your existing mortgage?
  • Do you want to avoid the high closing costs associated with a mortgage refinance?
  • Do you want to have the flexibility to borrow additional funds against your home in the future?

If you answered yes to any of these questions, an ARC Home Equity Line-of-Credit might be right for you! Avoid the cost and time involved with a traditional mortgage refinance plus gain the ability to make advances against the line in the future, as you so desire.

Features

  • 10-year advance period
  • 20-year repayment period
  • The Rate Index is Prime
  • Refinance up to 80% of your primary home's value
  • Finance as little as $10,000
  • Click Here for current rate

Benefits

  • Your monthly payment will be calculated on your current balance
  • You may use the available funds for just about anything - college tuition, home improvements, loan consolidation
  • Minimal closing costs
  • Quick closings
 

  1. What are the steps to apply for a mortgage - Here we'll review what information you'll need to have ready and how to contact an ARC mortgage specialist.  read more...
  2. What is the difference between a pre-qualification and a pre-approval - There is often some confusion between a pre-qualification and a pre-approval.  Let's review that here.  read more...
  3. Should I lock in my rate - How and when should I lock in my mortgage rate?  read more...

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1. What are the steps to apply for a mortgage       back to top

  • Gather essential financial information.
    • When buying a home, you'll need to provide us with the purchase price and down payment amount.
    • When refinancing a home, you'll need to tell us the estimated property value and amount you want to borrow.
    • Our Homebuying Checklist and Refinance Checklist provide complete lists of the documentation you'll need.
  • You may obtain your Pre-qualification in the following convenient ways:

After your pre-qualification, your mortgage specialist will go over the steps involved in with continuing to process your application and closing your loan.

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2. What is the difference between a pre-qualification and a pre-approval       back to top

  • What is a pre-qualification? A pre-qualification is an estimate of how much you can afford in a mortgage payment. It is based upon the information you provide, and is subject to the approval process, including further details such as an appraisal and income verification. The information you provide won't be verified as part of the pre-qualification process.
  • What is a pre-approval? A pre-approval is a firmer commitment on behalf of the mortgage company and is a more formal process which includes verification of information provided in the pre-qualification. You will also need to provide paystubs and W-2 forms (or tax returns if you are self-employed), plus statements from savings and investment accounts to verify your assets.
  • However neither a pre-approval nor a pre-qualification means you are guaranteed a mortgage. Lenders still need to look at property appraisals, verify information, and in many cases, re-check credit before agreeing to make a loan.

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3. Should I lock in my rate       back to top

If you want to avoid the possibility that interest rates will rise before you close on your home loan, you can lock in your loan pricing after your mortgage application is completed. Locking in your loan pricing guarantees that you'll get the price you agreed upon. Talk to an ARC Mortgage Specialist for more information.