How To Get Lower Rates From NJ Mortgage Bankers
March 9, 2016
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March 11, 2016

Bloomingdale NJ Mortgage

How to Get a Bloomingdale NJ Mortgage

First off if you are considering getting a Bloomingdale NJ Mortgage and looking to buy a home in town you have made a great decision. It is a welcoming North Jersey town that has much to offer its residents.  Shortly we will discuss the mortgage details but here is some interesting information regards to Bloomingdale NJ’s history as well.

Bloomingdale’s Federal Hill was the site of the 1781 Pompton Mutiny, a winter revolt of Continental Army troops that was crushed by General Robert Howe on direct orders of General George Washington.

Growth in Bloomingdale was driven by the development in the late 1860s of a rubber mill and other factories in neighboring Butler. The New Jersey Midland Railroad, later known as the New York, Susquehanna and Western Railway, laid tracks adjacent to the settlement, with a Bloomingdale station located in what today is Riverdale. The northern section of Riverdale and most of Butler were known as East Bloomingdale and West Bloomingdale respectively during most of the 19th century. Despite crossing a county border, they also shared a school district and residents considered the whole area as “Bloomingdale” until about 1881 when a Post Office named Butler was designated. This began a period of rivalry which caused a schism between the residents of Butler and Bloomingdale resulting in separate schools, churches and even town bands.

Bloomingdale was incorporated as an independent borough on February 23, 1918, when Pompton Township was split up into three new municipalities along with Wanaque and Ringwood.[21] Prior to that, the area was known as Bloomingdale throughout the 19th century and was initially a farming community starting about 1712 with the “Bloomingdale Forge” built shortly thereafter to take advantage of the iron in the hills. The business district along the Paterson-Hamburg Turnpike and the Pequannock River began about the middle of the 19th century.

Bloomingdale, like most municipalities in North Jersey, is a suburb of New York City. Some of the things that still link Bloomingdale to its past are its two churches (Methodist and Baptist), the Samuel R. Donald School (originally built in 1886) and the Bloomingdale Cornet Band continuously active since 1884.

Now that you have some history about your town let’s talk about what you need to get your Bloomingdale NJ Mortgage in place with Residential Home Funding.  First we want to make sure you fully understand the details and steps of how to get a mortgage in Bloomingdale.  All NJ mortgage lenders are not equal, so working with a local expert like Residential will have a huge impact on your home purchase

Bloomingdale NJ Mortgage

Get a Bloomingdale NJ Mortgage

Most people have heard the term mortgage before but when asked not many really understand the true definition.  When you try and get your Bloomingdale NJ mortgage it is important you know that it is a debt instrument, secured by the collateral of the Bloomingdale Home.  Meaning you the borrowers has to pay back the certain amount with a set of payments.  A mortgage is leverage, you get a home for the agreement to pay the money back with interest, once done you own the home free and clear ( no more bloomingdale NJ mortgage) owed to the bank. Mortgages are also known as “liens against property” or “claims on property.” If the borrower stops paying the mortgage, the bank can foreclose.

The bank basically has a claim on your house, so if you default on the mortgage the bank takes the house back has a foreclosure, sell the house and use that money to pay off the mortgage debt

Mortgages come in various forms. With a fixed-rate 30 typical mortgage, the borrower pays the same interest rate for the life of the loan and is locked in at that rate.  You can refinance if you find a lower rate later on but that is another topic.  Your Bloomingdale NJ mortgage principal and interest payment never changes from the first mortgage payment to the last.  A fixed-rate mortgage is also called a traditional mortgage sometimes.

With an adjustable-rate mortgage (ARM), the interest rate is fixed for an initial term, but then changes with market interest rates, so volatility in the marketplace can affect your bloomingdale NJ mortgage interest rates. They can also decrease which is great, but not knowing what the case might be is stressful for most owners.  ARM’s can be good for people not looking to stay in their home for a long time and they take advantage of the low rate up front and sell before the rate changes later.

Other less common types of Bloomingdale NJ mortgages, such as interest-only mortgages and payment-option ARMs, are best used by sophisticated borrowers. Many homeowners got into financial trouble with these types of mortgages during the housing bubble years.

Can I afford a Bloomingdale NJ Mortgage?

Most of the time a prospective Bloomingdale NJ buyer can afford a mortgage on a house that costs between 2-2.5 times the gross income, this is only a general guideline but can give you some ideas when looking in Bloomingdale for homes that won’t make you house poor

Bloomingdale NJ Mortgage Lending Basics

When you decide on a property your local Bloomingdale Residential Home Funding Mortgage Lender will help you have a good understanding if the property is within your financial reach.  Lenders use formulas that are much more complex and thorough. Secondly, you need to determine some personal criteria by evaluating not only your finances but also your preferences.

Lender’s Criteria: Debt-to-Income Ratios for a Bloomingdale NJ Mortgage

From a lender’s perspective, your ability to purchase a home depends largely on the following factors:

Front-End Ratio. This is the percentage of your yearly gross income dedicated toward paying your mortgage each month. Your mortgage payment consists of four components: principal, interest, taxes and insurance (often collectively referred to as PITI. A good rule of thumb is that PITI should not exceed 28% of your gross income.  Your Residential Home Funding Loan Officer and you will have a conversation with more detail once an actual Bloomingdale home has been determined so you can know how to make an offer as well and how much negotiating power you have regards to your mortgage costs.

Back-End Ratio. The back-end ratio, also known as the debt-to-income ratio (DTI), calculates the percentage of your gross income required to cover your debts.  Credit cards, other loans, child support, car payments, student loans etc are all examples of what has to be taken into consideration so it doesn’t go over about 36% of your gross income. To calculate your maximum monthly debt based on this ratio, multiply your gross income by 0.36 and divide by 12. For example, if you earn $100,000 per year, your maximum monthly debt expenses should not exceed $3,000.

Bloomingdale NJ Mortgage Down Payment Amounts.

A down payment of at least 20% of the purchase price of the home minimizes insurance requirements, but Residential Home Funding loan officers has access to local Bloomingdale NJ mortgages  to let buyers purchase a home with significantly smaller down payments. The down payment has a direct impact on your mortgage payment, which will of course have an impact on both the front and back end ratios just mentioned.  As you are aware larger down payments  mean you can get a more expensive home.

Don’t Be House Poor:

Being house poor is never a good idea, getting a bloomingdale NJ mortgage that exceeds your income might mean you have a great house, but there might not be any furniture in it and you can never have enough money to go anywhere or do anything.  So, keep things within reason because the theory your income goes up and over time as you pay off the mortgage it goes down doesn’t always come true

Personal Criteria is often not realistic and many buyers have to keep this in mind. Getting approved for a Bloomingdale NJ mortgage doesn’t mean that you can actually afford the payments. So, in addition to the lender’s criteria, consider the following issues and set some decisive factors of your own:

When discussing g your ability to pay a Bloomingdale NJ mortgage, ask yourself the following questions: Are you relying on two incomes just to pay the bills? Is your job stable? Can you easily find another job that pays the same, or better, if you should lose your current job?

Expenses and the calculation of your back-end-ratio will include most of your current debt expenses, but what about other expenses that you haven’t generated yet? Will you have kids in college someday? Do you have plans to buy a new car, truck or boat? Does your family enjoy a yearly vacation?  Don’t let the goal of buying a house hinder other areas of your life where possible.  Everyone needs a roof over their head, however if you can never enjoy the fruits of your labor elsewhere many would say what is the point?  Keep your lifestyle in mind when aiming for getting your Bloomingdale NJ Mortgage, if fewer trips to the mall, maybe less meals out or coffee don’t bother you applying a bit higher back end ratio might be ok in your personal situation.

Something many people don’t think of is the personality they have or of the ones they are living with.  Nobody is the same, regardless of how much money they make.  Some people can rest easy knowing they own $4,000 dollars month for the next 30 years to the bank for their Bloomingdale NJ Mortgage while others can’t get over paying $2,000 a month. If you keep your personality in mind when shopping for a new house in Bloomingdale you are likely to be pleased with your purchase.

Beyond the Mortgage in Bloomingdale NJ

Buying a new home is so exciting, but that often leads to financial blindness because that big beautiful dream house is looking right at you.  Pause and consider the financial responsibilities of homeownership. While the Bloomingdale mortgage is certainly the largest and most visible cost associated with a home, there are so many more additional costs that come along caring for a home.  Keep this in mind when shopping around for that dream house.  Being house poor leaves little room for the never ending maintenance and utilities that comes with any home no matter how new and shiny.  Remember, these expenses are not included in the front-end ratio, or the back-end ratio but these expenses are unavoidable for just about everyone.

Why work with your local Residential Home Funding loan officer to get your Bloomingdale NJ Mortgage?

The cost of a home is the single largest personal expense most people will ever face.  The decisions may seem overwhelming and complicated, however working with the best local loan officer makes the process an enjoyable one.  We will help take your personal situation into consideration, your future lifestyle and assist in not only getting you the best Bloomingdale NJ Mortgage.  But help you make an informed decision to the purchase of your new home is one you can afford without compromising your future.  You are more than just a client to us here at Residential, because we are local many of you become neighbors and we look out for each other.  We would welcome the opportunity to speak with you further about getting a Bloomingdale NJ Mortgage.

 

*This is not a commitment to lend. All rates, fees and loan terms are subject to a formal loan application, credit risk, appraisal evaluation and other lending criteria. Programs, rates, terms and conditions are subject to change without notice. Other restrictions may apply.
Licensed Mortgage Banker - CT, DC, DE, FL, GA Residential mortgage License - #23969, MD, NC, NJ Dept. of Banking & Insurance, NY Dept. of Financial Services, PA Dept. of Banking & Securities, SC and VA Banking Depts. – NMLS #34973 – Equal Housing Lender

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