Frequently Asked Mortgage Questions

Do you have questions? We can help! You will find the answers to several frequently asked mortgage questions below.

How do Adjustable Rate Mortgages Work?

Though there are many similarities with the features of adjustable rate mortgages, there are numerous options to choose from. One common feature of an adjustable rate mortgages is that they share an interest rate change that occurs after a stipulated number of payments have been made. The interest rate can increase or decrease depending on how the new predetermined index value and a margin. If a Mortgage Broker currently has an interest rate that is pending adjustment, the new rate would be calculated by adding the current index rate and a margin.

For example: If the mortgager's current rate was 6.000% with a 2.000% margin, the new rate would be determined by adding the current index rate (5.000% as an example) to the margin. In this example, the new interest rate would be 7.000%.

The maximum amount the interest rate can change during any adjustment period is usually fixed. This maximum adjustment is called a cap. Adjustable rate mortgages also have a lifetime cap, preventing the interest rate from exceeding a predetermined rate.

What are Escrow Accounts and How Much do I Need in My Escrow Account?

Escrows are payments made by a mortgager to a mortgage for the purpose of paying the mortgager's taxes, insurance, and other payments associated with home ownership. The mortgagee is responsible for the timely disbursement of escrow funds to pay the mortgagor's bills as they come due.

Usually, a mortgage company collects funds for placement into the mortgager's escrow account with the mortgager's periodic payment for principal and interest. An escrow account has sufficient funds if there is enough to pay all bills when they come due.

It is common practice for mortgage companies to hold an escrow cushion for a mortgager. The cushion is kept by the mortgage company to assure that if the cost of any escrowed item were to increase in the future, there would be sufficient funds to pay all bills as they come due.

Can Mountain Mortgage Help Me if I am Moving to Another City?

Yes we can! Though we are based in Southern Oregon, we can help get you a loan anywhere in the state! Feel free to call us (541) 774-9002, or e-mail us with your question at kevin@mountainmtg.com. We are willing and eager to work with you!

What if I Don't Have All of the Necessary Items to Complete My Loan Application?

Even if you do not have all of the necessary items to complete your loan application, still come in to the office, or contact us by phone or e-mail and we will work with what you bring to the table. We care about our customers and will strive to help you get the loan you want even under tight circumstances. We can't help you however until you contact us, so come on in today and see what we have to offer!