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Daily Interest Rates
Interest rates fluctuate from day to day and will also vary from loan to loan based on a borrower’s profile. Speak with a lender for today’s most current rates as it relates to you.
Mark AnuntiBell Bank218.310.3493manunti(at)bell(dotted)bank
Steve RajMiners National Bank218.391.5498steven(at)mnbeveleth(dotted)com
Elizabeth LundgrenNorth Shore Bank218.625.1245elundgren(at)northshore(dotted)bank

Mortgage
When borrowing money to purchase real estate, there are 4 main types of mortgages:
  • Conventional (loan amount up to $726,200) – Fixed or Adjustable Interest Rate
  • Jumbo (loan amount $726,201 or above) – Fixed or Adjustable Interest Rate
  • In-House (portfolio loan) – Adjustable Interest Rate
  • Government Insured (FHA, VA or USDA) – Fixed Interest Rate
Visit your preferred lender website to apply online.

 
(See Example Application)
 
Lender(s)
Not all lenders offer the same loans, interest rates or underwriting process. Every lender has pros and cons. Here are some things to consider when choosing a lender.
Loan Factors
When applying for a loan, here are 6 primary factors a lender will consider:
  • A numerical representation of creditworthiness. It measures the likelihood of possible default on a loan – the lower the score, the higher the risk. This score is commonly referred to as a FICO score, named after the company that created the most used scoring formula. A multitude of factors are taken into consideration when calculating a credit score, including payment history, credit length, and types of credit. The range for a FICO score is from 301 to 850, with scores above 740 considered excellent. Having an excellent credit score enables a borrower to secure the best loans and lowest rates available.
  • A percentage that helps lenders determine the level of risk associated with granting a loan to a borrower. It is calculated by taking the total of all monthly debt payments and dividing it by the borrower’s monthly gross income. This metric can be used to evaluate an individual’s creditworthiness and ability to repay debts, as well as their overall financial health. The debt-to-income ratio is an important factor when a lender is considering loaning money, as it provides insight into the borrower’s capacity for repayment. Generally speaking, lenders prefer borrowers who have a lower debt-to-income ratio so they can reduce their risk of defaulting on the loan
  • An upfront payment made by a potential buyer when purchasing real estate property. It is usually expressed as a small percentage of the total purchase price, though there are instances where some lenders may require up to 20% or more of the purchase price depending on other factors such as credit score or type of loan taken out (e.g., FHA loan). The down payment serves as collateral for lenders in case of default on payments and helps reduce their overall risk associated with loaning money for large purchases like houses or cars. It also demonstrates that buyers are serious about making their payments and have enough resources saved up for initial costs associated with owning property – such as things like home inspection fees and moving costs – which makes them more attractive candidates for loans from banks and other financial institutions.
  • A record of past employment.
  • The amount a buyer is willing to pay for a property. When making an offer on a piece of real estate, the buyer sets a price that reflects their perceived value of the property. This amount may vary from the asking price or market value of the property. Additionally, the term value can also refer to net income or cash return, divided by a capitalization rate, which is a common way to determine a fair price for an investment property. Ultimately, the value or price of a property is determined by the individual needs and considerations of the buyer, and can vary widely based on a multitude of factors.
  • The overall structural and cosmetic status of a house. Condition is important as it may affect enjoyment, work needed, and financing.
  • The money that is set aside or saved by an individual or business to use in case of a financial emergency. Cash reserves are typically composed of liquid assets such as cash, bank balances, and short-term investments that can be easily converted into cash quickly with minimal impact. Having sufficient cash reserves allows individuals and businesses to pay for unexpected expenses when needed without needing to borrow money or sell off assets.

Credit
Credit is the ability to borrow money based on the likelihood the money will be paid back as agreed upon. In order to understand your credit position, it is helpful to regularly check your credit score and credit history. This practice not only allows you to be more aware of what lenders see, but it can help detect inaccurate or incomplete information.

Credit Report:
Checking your own credit report is not an inquiry about new credit, so it has no effect on your score. You have the right to request one free copy of your credit report each year from each of the three major consumer reporting companies (Equifax, Experian and TransUnion).

Visit equifax.com to request a free copy.


Credit Score:
580 to 620 – Fair
621 to 680 – Good
681 to 740 – Very Good
741 and Up – Excellent

Tips to Improve Credit Score:
  • Make all required loan or credit card payments ON TIME.
  • Build savings to cover 3-6 months of expenses in case of unforeseen circumstances.
  • Reduce credit card balances to less than 30% of credit limit.
  • Limit credit report inquiries for purchases, applications or other lines of credit.

Pre-Approval Letter

In preparation for the house exploration process, a pre-approval letter from a lender will play a valuable role when making an offer to purchase a property.

Here are the items needed to obtain a lender pre-approval letter:
  • Completed Mortgage Application
  • Photo ID
  • Last 2 Pay Stubs
  • Past 2 Years’ Tax Returns or W-2s
  • Complete Bank Statements for Previous 2 Months
 
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