Mortgage FAQ's

Applying for a Mortgage Loan

What can I expect from the home buying process?

Learn more about the State Bank home buying process.

What do I need to know about financing?

State Bank of Southern Utah has financing available and wants to help you obtain financing. The idea of getting a home loan can be daunting, especially if you haven't done it before but it doesn't have to be difficult. State Bank's professional staff can help guide you through the home financing process and make it an enjoyable experience. Apply online or contact a Mortgage Loan Officer.

How does my credit score factor?

Credit scores, and more importantly credit history, can have both a positive and/or negative effect on your interest rates and the programs that are available to you. If you are uncertain about your credit, we recommend that you schedule a complimentary mortgage consultation with our Mortgage Loan Officers to discuss your credit, and options. We can let you know how your credit is affecting your mortgage loan options and even give you advice on how to improve your options by strengthening your credit and possibly increasing your score.

What can I afford?

Determining how much you can afford to spend on a home, will most likely be a decision you have to make. Mortgage loan officers at State Bank of Southern Utah, can help you make that decision through our mortgage consultation. During that meeting we will calculate your income, assets, and liabilities and determine what amount you will qualify for. Often, customers will qualify for a loan payment that is more than they feel they can afford. When this happens we work closely with the borrower and determine a price range that they are comfortable with and help them stay within their budget. Use our loan calculators to help you come up with an estimate.

How do I qualify for a loan?

The only way to determine if you qualify is to apply for a pre-approval. This process is very simple. You can apply online, or schedule an appointment to meet with our Mortgage Loan Officers. They will discuss and review the multiple requirements to qualify and at the end you will know if you are qualified to get a home loan.

What do I need to apply?

Nothing. You can start with just a consultation, and that can help determine the path we recommend you proceed. Certain items are helpful and will be required later on in the process. A list of those items can be found on our mortgage checklist.

General

How do mortgages work?

A mortgage is a loan secured against real property (usually a home). A deed of trust is recorded with the county securing the lenders rights to the property. Once the loan is paid in full the deed of trust is removed.

How do mortgage interest rates work?

Interest rates are set daily by lenders, who base their rates on a multitude of economic factors. Though nothing directly affects interest rates, things like inflation, economic growth or decline, the Federal Reserve Board, and money supply are the largest indirect contributors to interest rates.

What is mortgage insurance?

Mortgage insurance is an insurance policy that protects the lender in case of default on the loan. This is almost always paid by the borrower and it can be for a period of time, or for the full duration of the loan depending on what type of mortgage insurance and/or what type of loan is obtained.

How much does mortgage insurance cost?

The costs for mortgage insurance varies greatly. It is determined by loan type, down payment amount, and credit scores. When trying to decide what mortgage loan is best, the APR rate is the best indicator of costs.

Are mortgages paid monthly?

Yes, mortgage payments are typically due on the 1st of every month, but have a 15 day time frame to make your payment. They are not considered late until the 16th.

Are mortgages non-recourse?

Yes and No. Recourse action is governed by state, and depending on what state the property is located it may be vulnerable to recourse actions. Utah and Nevada are the two most common states SBSU lends to. Utah is a recourse state, Nevada is a NON-recourse state.

Are mortgages public records?

That depends on the State the property is located in. Utah is a non-disclosure state so the mortgage or "note" is not public record. Only the Deed of Trust is public record.

Are mortgages tax deductible?

Partially, yes. When you get a mortgage your lender is required to report the interest to the IRS as income. This allows the borrower to report the interest they paid on their loan as an expense and is currently allowed to be deducted. We urge you to see professional advice from a CPA or other licensed professionals to determine if your payment is tax deductible.

How does mortgage interest work?

Mortgages are compounded monthly. This means the interest due is calculated once a month, and based on the current balance. At the start of your loan repayment, a majority of your payment will go toward interest, but as the balance on your loan goes down, more and more of your payment is applied to the balance until it is paid off at the scheduled end date. Paying additional payments toward the principle will hasten this effect and will allow you to pay off your loan earlier and save money that would have been applied toward interest.

Are mortgage rates negotiable?

Mortgage rates are determined by a variety of economic factors, and are set daily, while subject to change at any time. A customers' offered interest rate is determined by the daily rate as well as specific factors in the customer's application.

Are mortgages bad?

No. Mortgages are a great way to strengthen someone's credit score, they are historically a very safe investment, and you can often own a home for as much or less than you can rent one for.

Are mortgages assets or liabilities?

Both. Mortgages are a liability, but the longer you own them the more they appreciate in value and the equity you build up becomes a very valuable asset.

Are mortgages liquid?

Not typically, but you can get a loan like a Home Equity Line of Credit, that can make using the asset a lot easier.

Can mortgages be paid with a credit card?

Mortgages cannot typically be paid with a credit card.

Can mortgages be transferred to another person?

That depends on what type of loan as well as to whom it is being transferred. This is called an assumption.

Can mortgages be paid off early?

Yes. You can pay extra or pay it off at any time. Some loans will have a pre-payment penalty for paying it off within the first few years, but these are not very common any longer.

Can mortgages be sold or transferred?

Yes, Mortgages are sold all of the time. The terms of your mortgage cannot change when sold, and this doesn't always mean that the servicer will change.