Frequently Asked Questions
Application FAQs
We offer our customers two ways to apply: in person at a branch office or by calling 323-980-1010.
Yes, the application process is secure. All information provided to Geo-Corp on the application is private information and will not be shared with any unnecessary parties.
A Geo-Corp sales manager will confirm the information on your application and will contact you within 24 hours to confirm and discuss the information on your application. He or she will then turn the application over to a loan processor, who will monitor the progress of your application until closing or will notify you in writing that your loan has been declined.
You'll be asked for the following information:
Personal
Employment and salary history for the past two years
Addresses of your residence for the past two years, as well as landlords (if applicable)
Your social security number, and if applicable, the social security number(s) of your co-borrower(s)
Financial
Your current income - this includes your base salary, and commissions or bonuses, dividends, etc. (income from alimony, child support, or separate maintenance payment need not be revealed if you don't want it to be considered as a basis for repaying the loan)
Numbers and locations of your bank accounts
Bank/Investment account numbers, balances, and names of the institutions holding them
As we continue with the loan process after your approval, you will need to supply us with pay stubs from your employer covering the last 30 days prior to completing the loan application.
If you are self-employed or compensated by commissions, you will need to supply your federal tax returns for the most recent year you filed and the year preceding that one (two years total).
Home Buying FAQs
Locking your interest rate means your lender guarantees the rate on your loan even if market rates change before closing. Most lenders will allow you to lock your rate for 30 to 45 days, with the option to extend the rate-lock period for a fee. So how do you know whether to lock your interest rate? It depends on whether you expect rates to rise or fall before you close on your home. No one knows for sure which direction rates will go at a given time, so it's a difficult to make a reliable prediction. It helps to keep track of announcements from the Federal Reserve Board, whose monetary policies have an effect on mortgage rates, and to talk to you financial advisor about what may happen in the near term.
Discount points are prepaid interest, which you can pay to your lender at closing in exchange for a lower interest rate on your mortgage. Paying discount points, each of which is equal to 1% of the loan amount, is often called “buying down” your rate.
So does paying points make sense for you? The answer depends primarily on how long you plan to stay in your home. First, find out how much lower your monthly payments will be if you pay points. Then, calculate how long it will take for those monthly savings to add up to the cost of the points. If it would take five years to break even and you're planning to live in your home for 10, paying discount points may be a smart move.
A “point” is equal to one percent of the loan amount. Points can be either positive (discount points) or negative (rebate points). The more discount points you choose to pay up-front, the lower your interest rate will be. Or, you can opt for a loan with a higher interest rate in exchange for a rebate, which will give you credit towards paying some of your non-recurring closing costs, such as title insurance, appraisal and origination fee. You cannot get any cash back from rebate points.
Closing costs vary based on a number of factors— the lender, mortgage type, purchase contract, location, etc. — but they usually include the following:
Lender fees: Your mortgage company may charge for expenses related to making the loan including an appraisal fee, a credit report fee, origination points, and discount points.
Third party fees: Charges for services not provided by your lender often include the settlement fee, title insurance, and attorney fees.
Prepaid items: Certain mortgage costs must be paid to your lender in advance. The most common of these are pre-paid interest, hazard insurance, and deposits to set up an escrow account.
Getting pre-approved means you receive a loan commitment from your mortgage company, based on a review of your credit and finances, before you have found a home. Having your credit pre-approved shows sellers that you are a qualified buyer and helps you establish a clear price range. The process is the same as a typical mortgage application, except that your application doesn't include property information.
Your credit history is only one factor in qualifying for a loan, and having made some late payments does not have to keep you from buying a home. Someone who has consistently made payments on time in the past may have more financing options than someone who has not, but that does not mean a mortgage is off-limits if you have had credit problems.
There is generally no minimum down payment required for buying a home. Many first-time buyers believe they must be able to put down as much as 20% of a home's purchase price in cash. That may have been true in the past, but many of the mortgage options available to today's home-buyers require little or no down payment. With housing prices as high as they are, homeownership would be impossible for many people if not for these low down-payment options.
Geo-Corp considers many factors in evaluating your loan application, but we usually focus on four areas:
Income and Debt: Factors such as how much money you make and what other bills you have to pay help us determine whether you can afford to make mortgage payments.
Assets: We need to make sure you have enough money to cover the costs of buying a home.
Credit: Factors such as whether you have or have not met other financial obligations help us predict whether you will repay your mortgage.
Property: The home you want to buy has to be worth enough to act as collateral for the mortgage.
For most borrowers, each monthly mortgage payment goes toward the following:
Principal, which is the total outstanding balance of the loan
Interest, which is the cost of borrowing money
Taxes, which are levied on the property by the local government
Insurance, which protects the owner and the lender from losses caused by fire and natural hazards
Your loan-to-value ratio (LTV) shows your equity in the property. Your equity is basically the amount of the property you own, expressed as a monetary figure. Another way of thinking of your equity is that it's the amount of money you'd receive if you sold your property at its valued price, less what you'd have to return to your lender to repay the loan. Example: $100,000 value minus $50,000 to repay loan = $50,000 equity. Your LTV and equity are crucial because common wisdom among lenders is that the higher the LTV (and the lower the equity), the higher the risk of a borrower defaulting on his or her loan. Thus, low equity loans present lenders with greater risk, forcing them to increase their costs.
Final closing costs can differ from an estimate for a variety of reasons including:
A special inspection of the property may be required (termite, electrical, plumbing, etc.).
A more in-depth property value analysis may be required if the property has unique structure/design aspects or presents other factors that make it difficult to determine the market value.
The cost for title insurance in a purchase money transaction (acquiring property by payment of money or equivalent) is usually negotiated.
Some small fees (recording, notary, title, etc.) are based on the number of pages in your title/closing documents and can’t be included in an estimate.
Private Mortgage Insurance (PMI) provides your lender with a way to recoup its investment if you are unable to repay your loan. PMI is usually required when the mortgage amount is higher than 80% of the home's value. That means that if you buy a home with a down payment of less than 20%, you will probably have to pay for PMI.
Refinancing FAQs
Yes, the appraisal determines the value of the property in question, which becomes a prime factor in determining the loan-to-value (LTV) ratio (the amount of your loan divided by the value of your property). Your LTV is important because it determines your equity in the property.
Locking your interest rate means your lender guarantees the rate on your loan even if market rates change before closing. Most lenders will allow you to lock your rate for 30 to 45 days, with the option to extend the rate-lock period for a fee. So how do you know whether to lock your interest rate? It depends on whether you expect rates to rise or fall before you close on your home. No one knows for sure which direction rates will go at a given time, so it's a difficult to make a reliable prediction. It helps to keep track of announcements from the Federal Reserve Board, whose monetary policies have an effect on mortgage rates, and to talk to you financial advisor about what may happen in the near term.
Discount points are prepaid interest, which you can pay to your lender at closing in exchange for a lower interest rate on your mortgage. Paying discount points, each of which is equal to 1% of the loan amount, is often called "buying down" your rate.
So does paying points make sense for you? The answer depends primarily on how long you plan to stay in your home. First, find out how much lower your monthly payments will be if you pay points. Then, calculate how long it will take for those monthly savings to add up to the cost of the points. If it would take five years to break even and you're planning to live in your home for 10, paying discount points may be a smart move.
People refinance their existing loans for a number of reasons including obtaining a lower interest rate, saving on monthly payments, and changing the term of the loan. People also choose to refinance if they want to switch from an adjustable rate to a fixed rate or to consolidate debt by refinancing for a higher loan amount and using the difference to pay off other debt.
A “point” is equal to one percent of the loan amount. Points can be either positive (discount points) or negative (rebate points). The more discount points you choose to pay up-front, the lower your interest rate will be. Or, you can opt for a loan with a higher interest rate in exchange for a rebate, which will give you credit towards paying some of your non-recurring closing costs, such as title insurance, appraisal and origination fee. You cannot get any cash back from rebate points.
You may pay an application fee as well as the appropriate closing costs. You may also choose to pay discount points if you want to buy down the interest rate.
If you have enough equity in your property, you can refinance with a loan amount greater than your current mortgage and keep the difference! You can use the money for home improvement, debt consolidation, or whatever else you would like.
For most borrowers, each monthly mortgage payment goes toward the following:
Principal, which is the total outstanding balance of the loan
Interest, which is the cost of borrowing money
Taxes, which are levied on the property by the local government
Insurance, which protects the owner and the lender from losses caused by fire and natural hazards
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