Owning your home: It’s a big part of the American Dream, and an important step toward a solid financial future. Plus, the equity and credit you build up through home ownership can help with other major purchases and secure your retirement down the road.
Ready to buy your first home, or just looking to upgrade or refinance? Either way, Hawaii National Guard Credit Union is here to help, with mortgage programs through our partner Aloha Pacific Federal Credit Union.
Home Loan Checklist:
Before you apply for a home loan, you’ll want to be ready with copies of the following documents for each applicant:
- Income - W2, payroll statement (current month), tax returns (two years) & other supporting documents
- Assets - Bank & investment statements (two months)
- Debts - Loan statements
- Other Documents - Real estate sales contracts, divorce decree, trust documents, homeowners policy, loan application
Steps to Buying a Home:
- Lender/loan selection
- Verification of information
- Credit check
- Title & homeowner insurance
- Loan closing
Definition: Long-term mortgage with fixed rates and monthly payments for the stated period of the loan.
Benefit: Predictable principal and interest payments over the life of the loan. If you plan for this home to be your primary residence for at least five years, you should strongly consider this option.
To qualify for a conventional mortgage, you may need to make a down payment, and your loan balance may not exceed the federal guidelines (currently $636,150 for Hawaii residents; $424,100 for Nevada residents).
Adjusted Rate Mortgage (ARM)
Definition: A mortgage with an introductory rate that can change after the initial period based on a rate index. There is a limit to how much the rate can vary in any given year, as well as a lifetime limit.
Benefit: Initial rates are typically lower than with a fixed-rate mortgage. If you plan to move in five years or make major renovations, this may be a better option.
ARM terms are quoted as 3/1, 5/1, 10/1, etc. The first number represents how long the stated interest is fixed. For example, a 5/1 ARM has a fixed interest rate for the first five years, then adjusts annually for the remaining term of the loan.
Definition: A loan amount that exceeds the federal guidelines.
Some home purchases may require a larger loan balance. If the loan amount exceeds federal guidelines, it is considered a jumbo mortgage. This type of loan offers the same terms as a conventional mortgage but may require higher rates.
First-Time Homebuyer Program
Some first-time home buyers may need a little extra help. That’s why Aloha Pacific offers a special program that reduces your out-of-pocket closing costs and initial down payment.
Investor Property Mortgage
For those investing in residential real estate, Aloha Pacific offers special investor loans (including balloon loans) designed to improve cash flow by amortizing over a number of years.
Amortization – Equal monthly payments of principal and interest over the life of the loan.
Annual Percentage Rate (APR) – Annual loan cost that includes other loan fees.
Closing Costs – Fees paid by the mortgage borrower, which can include loan fees, discount points, title insurance, appraisal fees, credit report, recording fees, etc.
Escrow – A third party that ensures that the buyer and seller meet their contractual commitments.
Loan Origination Fee – A one-time fee imposed by the lender to cover administrative costs.
Loan-To-Value (LTV) – Percentage of the loan amount divided by the market price.
Mortgage – A claim against the property given by the borrower to the lender as security for a loan.
Private Mortgage Insurance (PMI) – Insurance paid by the borrower when LTV is above 80%.
Points – A percentage of the loan paid by the borrower to reduce the rate.
Principal – The remaining balance or amount borrowed on a loan.
Title Insurance– A policy that covers losses arising from a legal defect in the title.
Title Search – The process that checks whether a property has liens and other claims.
As a member, you can receive personal service from a licensed realtor when buying or selling your home by using Aloha Pacific Premier Realty LLC. Call 808-531-HOME (4663) or click here for more information: Learn More
CUSO of Hawaii Services LLC is a credit union service organization created to help service the residential loans originated by various credit unions in the state of Hawaii. Learn More
Notary service is available at Aloha Pacific for a nominal fee. Contact us for more details.
APPLY FOR A LOAN
At Hawaii National Guard Credit Union, we strive to provide you with quick, safe and convenient services. You can begin the application process by clicking on the link below.
We’ll get back to you as soon as possible.