FAQs | LemonBrew Lending Corp. dba SD Capital Funding

Frequently Asked Questions (FAQs)

What is the difference between interest rate and APR?

Your interest rate is the monthly cost you pay on the unpaid balance of your home loan. An Annual Percentage Rate (APR) includes both your interest rate and any additional cost or prepaid finance charges such as the origination fee, points, private mortgage insurance, underwriting and processing fees. (Your actual fees may not include all of the items above.) While your interest rate is the rate at which you will make your monthly mortgage payments, the APR is a universal measurement that can assist you in comparing the cost of mortgage loans offered by different mortgage lenders.

Are the pre-qualification and preapproval services free?

There is no charge for getting pre-qualified or preapproved. You’re not under any obligation to use this site to apply for a loan, even if you use it to review interest rates and terms for a variety of loans, or use it to get preapproved or pre-qualify for a loan.

How important is the loan to value ratio?

The loan-to-value ratio or “LTV” shows how much equity you have in your home. Equity is the difference between how much your home is worth and how much you owe on it. For instance, if your home is worth $200,000 and you owe $130,000 on your mortgage, you have $70,000 worth of equity in your home. To calculate your LTV, divide your current loan amount by your home’s value. In our example, your LTV would be 65%. In the world of lending, higher loan-to-value (or lower equity) means there is a greater risk the borrower may default on the loan. Therefore, LTV is important in determining qualification for home loans and rates. In general, the lower your LTV, the lower your rate.

Can I get a loan if I live outside the United States?

Yes, as long as certain criteria are met. Typically, you must be a U.S. citizen with established credit and income history. We can occasionally assist borrowers who are not U.S. citizens if the home being financed is a primary residence. Additionally, the property must be located in the 50 United States or the District of Columbia. As always, every situation is unique, so contact a Home Loan Expert to be sure you qualify.

What if I have an H1B, L1, or EAD card?

We process the most non-permanent residents loans. We are experts with the visa process.

When is my rate locked?

Your rate can only be locked after you sign the full application package and provide ALL the initial financial documentation requested. Please keep in mind that your interest rate CANNOT be locked until we have received all signed application pages.

Who can answer questions not addressed here?

There are tons of ways to talk to someone at SD Capital Funding! If you’re not sure where to start, try our Client Relations team:
Call toll-free (855) 549-7001
E-mail us at info@sdcapitalfunding.com

Do's & Don'ts of Buying a Home

Do pay all your credit cards on time.

Do keep a positive balance in all of your checking and savings accounts.

Do keep your money right where it is. Changing banks or moving money back and forth will require explanation, which is just more paperwork for you and your lender.

Do think about the future. Consider what you want today and for the next 5 years. The average person stays in a home 7-10 years. If you are confident this is a starter home, see if your lender can approve you for a shorter-term (lower interest rate) loan. Or, if this is your forever home, ask for loan options that help you maximize principal verses interest rate payments.

Do relax. You are with the right team. Trust them and give them what they need to get you approved. You control a lot of the timing. If documentation is required, get it to your originator as soon as possible.

Do keep your loan originator’s phone number. They are a great source when you want to ask about refinancing, buying a second home or a new home in the future. They already have your history and they can advise you rather quickly.

Don’t use your credit card to buy things for your home before you close. (No excessive spending.)

Don’t buy a vehicle. Even if you are paying cash versus taking out a loan. Don’t do either. Most home loans close within 30-45 days. Your mother taught you that patience is a virtue. Wait until you are in the home.

Don’t quit your job.

Don’t open new revolving credit cards (even if the sales person offers you a 20% discount on your current purchase. Say no until after you close.)

Don’t make out-of-the-ordinary large deposits. If you must, be prepared to provide a clear paper trail from where and why.

Don’t buy large items on your credit cards. We can’t stress this enough.

Don’t lie on your loan application. You are asking complete strangers to trust you with thousands (if not hundreds of thousands of their dollars). Wouldn’t you want to know who you were getting into a contract with, too?

What We Need From You

Fully Executed Contract
Last 2 years of W2
Last 2 Pay Stubs showing 30 days income
Last 2 months of bank statement (all pages)
Homeowner’s insurance declaration page

If self employed , provide:

Last 2 years personal tax returns
If own more than one property provide:
Most recent mortgage statement
Homeowners insurance declaration page
Lease Agreement

Appraisal Process Explained

THE ORDER
We will order an appraisal on your home or potential new home, also known as the subject property.
Federal and state appraiser independence regulations require that the appraisal be completed by an unbiased, licensed and local appraiser in order to protect the public trust.

THE APPRAISER
By regulation, appraisers are not allowed to work with the lender, seller or client to reach a desired value or advocate for any party.

THE INSPECTION
Remember, the appraisal inspection is not the same as a home inspection. The appraiser gathers information to develop an opinion of value, while a home inspector gathers information to identify construction features, structural integrity and any necessary repairs or maintenance to the subject property.

THE VALUE
All of the values indicated by the various approaches are then reconciled to arrive at a final opinion of market value of the subject property.

THE QUALITY ANALYSIS
The lender’s underwriting department will then use the appraisal, in addition to other information gathered, to make an educated decision regarding your loan.

Home Buyers' Guide

Comfort: At the end of the day, you need to feel comfortable with your Lender and Mortgage Professional. You will want someone who can take the time to explain your options, answer questions, and provide clear information about what’s next in the process. If you’re “sixth sense” says it’s not a fit, move on. You deserve the best!

Why are assets and debts so important to the process?
Assets and debts are primary factors in determining your loan eligibility. No matter what your situation, the best course of action is to provide your Mortgage Professional with a full accounting of all your Assets and Debts to create a game plan that qualifies you for the best loan product.

Appraisal: : An estimate of the current market value of the property.

Earnest Money: Upfront money provided by the borrower to the seller as a show of good faith towards the purchase price of a home.

Gift Letter: A letter, which details the amount of gift and name of the giver, which indicates a gift of cash to the buyer of a home. This can be provided by relatives and friends, depending on the requirements of given lender and product.

Hazard Insurance: Also known as homeowner’s insurance, this covers the property from damages that may affect the value.

Private Mortgage Insurance (PMI): Paid in monthly installments by a borrower or upfront as part of the closing costs, this insurance allows a lender to lend more than 80 percent of the value of a property while protecting the lender on risk to the top 20 percent.

Title: The title is the actual document that gives evidence of ownership of a property.

Title Insurance: Title insurance protects lenders against any title dispute that may arise over a particular property. Home title insurance is a required fee paid at closing.

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