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1. Can I apply for a loan before I find a property to purchase? Answer
2. How much equity do I have available in my home to borrow against? Answer
3. Are there fees charged or any other obligations if I complete the online application? Answer
4. How do you decide what documentation is needed from me to process my loan? Answer
5. Will MCCU consider my overtime, commission, or bonus income when evaluating my application? Answer
6. If I have income that is not reported on my tax returns, can it be considered? Answer
7. What is a credit score and how does it affect my application? Answer
8. How do I know if I need a Home Improvement loan or a Home Equity loan? Answer
9. What terms are available for the Home Equity Loan? Answer
10. What terms are available for a Home Improvment loan? Answer

Q : Can I apply for a loan before I find a property to purchase?
A : Yes, applying for a mortgage loan before you find a home may be the best thing you could do.  When you apply in advance, you are issued a pre-approval letter subject to you finding your new home.  You can use the pre-approval letter to assure your real estate agent that you are a qualified buyer and that you are looking in the right price range to fit your budget.  Having been pre-approved for a mortgage may also give more weight on any offer you make.
 
Q : How much equity do I have available in my home to borrow against?
A : In order to calculate how much lendable equity you have available in your home, you must start with the value of your home.

For example:  Your home is worth approximately $250,000, you would multiply that by 80%, which in this case would give you $200,000.  Then, subtract your current 1st lien mortgage to give you the available amount to borrow.  In this case, say your first mortgage balance is $150,000, then you would have $50,000 available to borrow.

 

 
Q : Are there fees charged or any other obligations if I complete the online application?
A : There is not a fee to complete an online application for any of our loan products. 

If you are applying for a Mortgage (Purchase or Refinance), at the time the Loan Officer pulls your credit report to begin the pre-approval/loan process, a non-refundable fee of $55.00 is collected.

If you are applying for a Home Equity or Home Improvement loan, the credit report fee not applicable

There is no obligation to complete the mortgage or equity process once an application is completed.

 
Q : How do you decide what documentation is needed from me to process my loan?
A : The Loan Officer will to an interview with you and analyze your completed application, your credit report and an automated underwriting system to determine what documents are needed from you.

During the processing and underwriting part of your loan file, other documentation may be required in order to prepare your loan for final approval.

 
Q : Will MCCU consider my overtime, commission, or bonus income when evaluating my application?
A : In order for bonus, overtime or commission income to be considered, you must be able to show a history of receiving it for the previous 2 years and it must be likely to continue for the next 3 years.  Your Loan Officer will request copies of W-2 statements for the previous two years and your most recent 30 days pay stubs to verify overtime and bonus income.  If more than 25% of your income is commission earnings, we will need to obtain copies of your most recent 2 years signed tax returns to calculate the amount that can be considered as income.
 
Q : If I have income that is not reported on my tax returns, can it be considered?
A : Typically, only income listed on your tax returns can be considered when you apply for a mortgage. 
 
Q : What is a credit score and how does it affect my application?
A : Your credit score is one of the pieces of information used to evaluate your application.  Credit scores are based on information collected by credit bureaus and information reported each month by your creditors about the balances you owe and the timing of your payments.

A credit score is a compilation of all this information converted into a number that helps a lender determind the likelihood that you will repay the loan you have applied for on schedule.  Your credit score is calculated by the credit bureau, not by MCCU.  Credit scores are calculated by comparing your credit history with millions of other consumers.  They have proven to be an effective way of determining credit worthiness.

Credit scores used for mortgage loan decisioning range from around 300 to 900.  Typically, the higher your credit score, the lower the risk that your payments will not be paid as agreed.  Using your credit scores to evaluate your credit history allows MCCU to quickly and objectively evaluate your credit history when reviewing your application.  However, there are several factors considered when making a loan decision and we never evaluate an application without looking at the whole financial picture of a member.

 

 
Q : How do I know if I need a Home Improvement loan or a Home Equity loan?
A : A Home Equity loan has limits that are set forth by the Texas Consitition, which only allows for 80% of the value of a home to be accessed.  As well as limits of having only one Equity loan at a time and one per year.  If you have available equity in your home, you can use those funds for any purpose and a single amount is disbursed to you at closing to do as you wish.  The Home Equity loan can be in 1st or 2nd lien position.

A Home Improvment loan is a loan specifically used to make improvments to your home.  This type of loan requires a licensed contractor, a signed contract to complete the work and periodic disbursements.  The disbursements are made out to both the home owner(s) and the contractor to pay for work completed.  A Home Improvement loan allows for up to 95% of the value of your home and can only be in 2nd lien position.

 
Q : What terms are available for the Home Equity Loan?
A : MCCU has 4 terms available for the Home Equity product, each product is a fixed rate (rates available upon request).

60 months, 120 months, 180 months and 240 months

Home Equity loans can be in either 1st or 2nd lien position.

 

 
Q : What terms are available for a Home Improvment loan?
A : MCCU has 2 terms available for the Home Improvment product, both of which are fixed rate (rates availble upon request)

180 months and 240 months