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Loans FAQs

Applying for a mortgage can be very intimidating. You're asked specific details about your income, assets, and debts. Here we will give you information that will let you know how that information is used in in the application process.

If we have not answered your question here contact us at lanb@lanb.com, (505) 662-5171 or visit our mortgage loan center for more information on applying and qualifying for a LANB mortgage loan.

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Loans

Where can I find the current interest rates?
Search mortgage rates or call us anytime. Contact us

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Loan Application Process

Can I apply for a loan before I have a property to purchase?
Yes, applying for a mortgage loan before you find a home may be the best thing you could do! If you apply for your mortgage now, we'll issue an approval subject to you finding the perfect home. We'll issue a pre-approval letter online instantly. You can use the pre-approval letter to assure real estate brokers and sellers that you are a qualified buyer. Having a pre-approval for a mortgage may give more weight to any offer to purchase that you make.When you find the perfect home, you'll simply call your Loan Officer to complete your application. You'll have an opportunity to lock in our great rates and fees then and we'll complete the processing of your request.

What is a credit score and how will my credit score affect my application? 
A credit score is one of the pieces of information that we'll use to evaluate your application. Financial institutions have been using credit scores to evaluate credit card and auto applications for many years, but only recently have mortgage lenders begun to use credit scoring to assist with their loan decisions.

Using credit scores to evaluate your credit history allows us to quickly and objectively evaluate your credit history when reviewing your loan application. However, there are many other factors when making a loan decision and we never evaluate an application without looking at the total financial picture of a customer. Learn more.

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Refinancing

When should I refinance?
It is recommended to refinance when interest rates drop at least ¾ to 1% below your current interest rate.

What do I need to do to begin the refinance process?

  1. Mortgage Loan Application: to expedite the refinance process, it is crucial that you complete a mortgage loan application. Although, you may have a loan application on file from a previous loan, it is still necessary for you to complete a new application. You can receive an application at any of our branch locations or contact our mortgage loan department at 505.662.5171 to send you one. (Please make certain you request a mortgage loan application and not a regular loan application.)
  2. W-2 Information: along with your application we will need your last two years of W2 forms .
  3. Payroll Information: please attach copies of your payroll stubs from your previous month of employment.
  4. Appointment: call our mortgage loan department to schedule an appointment with a mortgage loan officer. Contact us.

What will my costs be if I decide to refinance?
You will be charged a $750 documentation fee. Title fees will apply and those costs vary based upon your loan amount. Other fees include an appraisal (if necessary), credit report costs and underwriting expenses. To receive a more personalized estimate of your closing costs, please set up an appointment with a LANB mortgage loan representative for a Good Faith Estimate.

What is a point?
One point is 1% of your loan amount. This amount can be paid in order to buy a lower interest rate. Your lending officer can discuss this option with you at your initial appointment.

What will my new payment be?
You can locate a loan payment calculator here. If you do not have access to the Internet please call a mortgage loan representative for a quote.

When can I lock into my new interest rate?
You may lock into your rate once your application is in process with your lender and your appraisal is complete. Once these two items are done, you need to contact our mortgage loan office between 10 a.m. - 2 p.m. (MST), Monday Friday to lock in your desired interest rate. Once you are locked into your interest rate, it cannot be changed without paying a penalty fee.

How long will the refinance process take?
We will set your closing date 25 days from the day you lock into your new interest rate. In the event this time frame is not feasible, we will do our best to accommodate your needs.

We realize that every individuals situation is unique, so we would be happy to set up an appointment with you to review your refinance needs. Call us at (505) 662-1080 or send us an email lanb@lanb.comReturn to refinance help center.

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Home Buying

Purchasing a home is a one of the most important financial decisions of your life, so at LANB we do our best to find a financing option that will fit your needs. We've provided a few commonly asked questions to help you if you're considering a refinance or the purchase of a new home. For additional questions, contact us at lanb@lanb.com. Contact us by phone.

How are interest rates determined?
Interest rates fluctuate based on a variety of factors, including inflation, the pace of economic growth, and Federal Reserve policy. Over time, inflation has the largest influence on the level of interest rates. A modest rate of inflation will almost always lead to low interest rates, while concerns about rising inflation normally cause interest rates to increase. Our nation's central bank, the Federal Reserve, implements policies designed to keep inflation and interest rates relatively low and stable.

What is an adjustable rate mortgage?
An adjustable rate mortgage, or an "ARM" as they are commonly called, is a loan type that offers a lower initial interest rate than most fixed rate loans. The trade off is that the interest rate can change periodically, usually in relation to an index, and the monthly payment will go up or down accordingly.

Against the advantage of the lower payment at the beginning of the loan, you should weigh the risk that an increase in interest rates would lead to higher monthly payments in the future. It's a trade-off. You get a lower rate with an ARM in exchange for assuming more risk.

For many people in a variety of situations, an ARM is the right mortgage choice, particularly if your income is likely to increase in the future or if you only plan on being in the home for three to five years.

Should I pay discount points in exchange for a lower interest rate?
Discount points are considered a form of interest. Each point is equal to one percent of the loan amount. You pay them, up front, at your loan closing in exchange for a lower interest rate over the life of your loan. This means more money will be required at closing, however, you will have lower monthly payments over the term of your loan.

To determine whether it makes sense for you to pay discount points, you should compare the cost of the discount points to the monthly payments savings created by the lower interest rate. Divide the total cost of the discount points by the savings in each monthly payment. This calculation provides the number of payments you'll make before you actually begin to save money by paying discount points. If the number of months it will take to recoup the discount points is longer than you plan on having this mortgage, you should consider the loan program option that doesn't require discount points to be paid.

If you'd prefer not to make this calculation the "old-fashioned way," we have a discount points calculator.

What is a point?
One point is 1% of your loan amount. This amount can be paid in order to buy a lower interest rate. Your lending officer can discuss this option with you at your initial appointment.

Is comparing APRs the best way to decide which lender has the lowest rates and fees?
The Federal Truth in Lending law requires that all financial institutions disclose the APR when they advertise a rate. The APR is designed to present the actual cost of obtaining financing, by requiring that some, but not all, closing fees are included in the APR calculation. These fees in addition to the interest rate determine the estimated cost of financing over the full term of the loan. Since most people do not keep the mortgage for the entire loan term, it may be misleading to spread the effect of some of these up front costs over the entire loan term.

Also, unfortunately, the APR doesn't include all the closing fees and lenders are allowed to interpret which fees they include. Fees for things like appraisals, title work, and document preparation are not included even though you'll probably have to pay them.

For adjustable rate mortgages, the APR can be even more confusing. Since no one knows exactly what market conditions will be in the future, assumptions must be made regarding future rate adjustments.

You can use the APR as a guideline to shop for loans but you should not depend solely on the APR in choosing the loan program that's best for you. Look at total fees, possible rate adjustments in the future if you're comparing adjustable rate mortgages, and consider the length of time that you plan on having the mortgage.

Don't forget that the APR is an effective interest rate--not the actual interest rate. Your monthly payments will be based on the actual interest rate, the amount you borrow, and the term of your loan.

How do I know if it's best to lock in my interest rate or to let it float?
Mortgage interest rate movements are as hard to predict as the stock market and no one can really know for certain whether they'll go up or down.

If you have a hunch that rates are on an upward trend then you'll want to consider locking the rate as soon as you are able. Before you decide to lock, make sure that your loan can close within the lock-in period. It won't do any good to lock your rate if you can't close during the rate lock period. If you're purchasing a home, review your contract for the estimated closing date to help you choose the right rate lock period. If you are refinancing, in most cases, your loan could close within 30 days. However, if you have any secondary financing on the home that won't be paid off, allow some extra time since we'll need to contact that lender to get their permission.

If you think rates might drop while your loan is being processed, take a risk and let your rate "float" instead of locking. After you apply, you can lock in by contacting your Loan Officer by telephone.

When can I lock into my interest rate?
You may lock into your rate once (1) your application is in process with your lender and your (2) appraisal is complete. Once these two items are done, you need to contact our mortgage loan office between 10 a.m. - 2 p.m. (MST), Monday Friday to lock in your desired interest rate. Once you are locked into your interest rate, it cannot be changed without paying a penalty fee.

What is your Rate Lock Policy?
The interest rate market is subject to movements without advance notice. Locking in a rate protects you from the time that your lock is confirmed to the day that your lock period expires.

Lock-In Agreement
A lock is an agreement by the borrower and the lender and specifies the number of days for which a loan’s interest rate and discount points are guaranteed. Should interest rates rise during that period, we are obligated to honor the committed rate. Should interest rates fall during that period, the borrower must honor the lock.

When Can I Lock?
We will review your documentation and credit package and notify you via email or phone when you are able to request the lock. When you decide to lock in your interest rate after being notified by your Loan Officer, you will be required to sign the Interest Rate Lock In Agreement.

Fees
We do not charge a fee for locking in your interest rate.

Lock Period
We currently offer a 25 day lock-in period on our site. This means your loan must close and disburse within this number of days from the day your lock is confirmed by us.

Lock Changes
Once we accept your lock, your loan is committed into a secondary market transaction. Therefore, we are not able to renegotiate lock commitments.

What is the maximum percentage of my home's value that I can borrow?
The maximum percentage of your home's value depends on the purpose of your loan, how you use the property, and the loan type you choose, so the best way to determine what loan amount we can offer is to complete our online application.

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Interest Rates

Call a LANB Loan Officer for the latest interest rates.

505-662-5171