Some borrowers begin looking for a home before they meet with their Lender. While you are not required to secure financing before you pick a property, it is in your best interest to meet with a Loan Professional to determine the amount of loan you will be able to afford before you sign a contract.

Where do I apply?

If you want to apply for mortgage, please contact your Southern Trust Loan Officer or apply online. Your Loan Officer will answer any questions you have and take your application over the phone or schedule a personal appointment at a time and location convenient for you.

What information will be required when I apply?

To speed the application process, here is some of the information you should provide:
Sales Contract (if available)
Social Security number[s}
Photo Identification
Most recent paystubs covering one months worth of income
Two years' most recent W-2s
Last 2 consecutive monthly statements from all asset accounts (Include IRA, TSP, 401K, etc.)
Two years residence history with addresses and phone numbers
Two years employment history with addresses and phone numbers
For VA applicants only - Certification of Eligibility and DD214
Authorization to obtain credit report
You should be prepared to pay for your credit report and appraisal at the time of application.

How long does the mortgage process take?

Processing and closing a mortgage usually takes between 15 and 45 calendar days. Your Southern Trust Loan Officer can give you an estimate based on your individual situation.

How much does it cost to close a mortgage?

In addition to your down payment, you may have to pay for closing costs and prepaid items. Your Southern Trust Loan Officer will provide you with a Good Faith Estimate within 3 days of application, which itemizes the closing costs, including but not limited to: Loan Origination Fee (varies with loan type and term) Discount Points (optional fees which can be paid to lower your interest rate) Appraisal Fee Credit Report Flood Zone Certification Lenders Title Insurance Owners Title Insurance (optional but recommended) Recording Fees Survey Fee Pest Inspection (if required) Underwriting / Document Review Fee Processing Fee Per Diem Interest (will vary based on closing date) Tax Service Fee Attorney / Settlement Fee Courier Fees Homeowners Insurance Mortgage Insurance Property Taxes Additional Fees as may be required by your State or locality Many of the same fees apply to refinance loans, but closing costs can often be included in the loan amount on refinances to eliminate any out of pocket expense.

I already own a home and am looking to relocate. Do I need to sell my current home before I purchase a new home?

In the current seller's real estate market, you may not have the luxury of writing a sales contract contingent upon the sale of your current residence. If you need the proceeds from the sale of your current residence in order to purchase a new residence, consider Southern Trust's Bridge Loan Program. If you are in a financial position such that you can afford both the mortgage on the existing and the new residence, you may elect not to sell your existing residence.

Do I need a real estate agent? How should I decide what real estate agent to use?

With advances in technology and the resources available today, many buyers choose to find a home on their own. It is important to note, however, that Real Estate Agents are often made aware of properties for sale before the general public. They can help you find a home that meets your needs much quicker by selecting properties for you to see based on the criteria that you give them (neighborhood, amenities, schools, etc). Your Real Estate Agent will advise you on how to write an attractive sales contract and will work as a negotiator between you and the seller and his/her listing agent. If you do not have an agent, your Loan Officer will be happy to recommend a reputable one in your area.

I have children; how do I find out about the schools in each neighborhood?

If you are working with a real estate agent, your agent should have information on the schools in your selected area. You may also contact the neighborhood schools directly for information.

How will my real estate agent (or builder) and my Loan Officer work together to coordinate the closing?

Good Real Estate Agents and Builders keep in close contact with all parties involved in a transaction. In a typical sale, purchase contract contingencies (i.e. financing, inspections) require that an agent or builder's rep communicate well with all parties to ensure that the contingency deadlines are met. The Real Estate Agents, Builder, Loan Officer and Settlement Agent / Attorney are dependent upon one another to close a transaction, so it is in their best professional interest, as well as their client's, to communicate efficiently and effectively with one another. As a buyer, you should also keep in close contact with each of these service providers for a status and progress report.

What is the minimum down payment required to buy a home?

Typically homebuyers make down payments of 5 - 20%. Southern Trust Mortgage offers several financing options that require no down payment at all. Click here for more details regarding 100% financing.

What is the minimum down payment typically required purchasing an investment or rental property?

The down payment requirement can vary depending upon the conditions of the economy at the time you are purchasing and can vary dramatically between lenders. Many lenders require a 20-30% down payment for homes that are not owner occupied. Southern Trust Mortgage offers superior investment property financing options, requiring no down payment in certain circumstances. For more information click here.

What is private mortgage insurance and am I required to have it?

Private mortgage insurance (PMI) is paid by the borrower to protect the lender in the event that the borrower defaults on the mortgage. Mortgage insurance is generally required on loans that exceed 80% of the value or purchase price of a property. It can also be required at other times if the lender perceives a higher risk associated with a particular loan program. There are financing options, which allow limited down payment borrowers to avoid mortgage insurance. For example, obtaining both a 1st and a 2nd mortgage rather than one mortgage for more than 80.00%. There are a few programs which do allow higher loan-to-values and do not require mortgage insurance. Your Southern Trust Loan Officer will explain each available option to you so that you can decide the best financing option for your unique situation.

What is Homeowner's / Hazard insurance?

Homeowner's insurance protects both the owner and the lender against physical damage to the property (i.e. fire or burglary). Some perils are not generally covered by the standard homeowner's polices, for example floods and earthquakes. Properties located in areas prone to fires and windstorms may have difficulty obtaining standard insurance policies.

How much Homeowner's insurance coverage do I need?

Your homeowner's policy must be for an amount equal to or greater than the value of the dwelling as stated in your appraisal. Lenders prefer and may require that you also have guaranteed replacement cost coverage, which will generally pay out 20-50% more than the face value of the policy to rebuild your home in the event of severe damage. A replacement-cost policy typically adjusts the amount of insurance each year to keep pace with rising construction costs in your area.

Must I have flood insurance coverage?

Your Lender will order a flood zone certification, which identifies whether or not all or part of your property lies in a flood zone. If the property is in a flood zone, you will be required to purchase and maintain flood insurance on the property.

What is Title Insurance and why do I need it?

Before you purchase a property or close on a new loan, the homeowner and lender must be certain that the title to the property will be free and clear, free of prior defects and clear of indebtedness. A title company researches the legal history of the property, which entails searching public records in the offices of the county recorder. Problems with the title could threaten the mortgage, limit ones use and enjoyment of the property and could result in financial loss. A policy of title insurance protects a homeowner's title and the insurer covers the cost of any legal challenges. Your Lender will require that you have "Lenders Coverage"; it is also recommended, but not required, that you purchase "Owners Coverage" to protect your own interest and investment in the property.

I want to purchase a condo or a property in a PUD (Planned Unit Development). What is the function of the Homeowners' Association (HOA)?

In some states, Homeowners' Association's are legally required for developments where residents share an interest in common property, such as condominiums or townhomes. The association is headed by a board of directors which generally follows a set of by-laws regarding maintenance, upkeep and other issues pertinent to the development. The development's unit owners must become members of the association and comply with its by-laws and pay dues or fees to finance maintenance and other development expenses (i.e. the master insurance policy).

What expenses are typically covered in the Homeowners' dues?

HOA dues cover the general maintenance and upkeep of all common areas within the development. These dues also contribute to the premium payments for the master policy of insurance, which protects all unit owners. Also included in HOA dues are major repairs not covered by insurance, the HOA could handle these unexpected expenses by a special assessment of all unit owners or by raising the association dues.

If my neighborhood has an HOA, what type of insurance will I be required to obtain independently?

The master insurance policy, which is purchased on behalf of all unit owners by the HOA, covers all units or structures located within the development but does not typically cover an individual unit owner's personal belongings located within their dwelling. Therefore, it is advisable to purchase a separate contents coverage policy for the protection of personal possessions.

What is the difference between pre-qualification and pre-approval? Is it necessary to get pre-qualified before making an offer on a property?

Some borrowers begin looking for a home before they meet with their Lender. While you are not required to secure financing before you pick a property, it is in your best interest to meet with a Loan Professional to determine the amount of loan you will be able to afford before you sign a contract. Because pre-approval includes a credit check, it is more powerful than a prequalification letter, which only estimates what you can afford based on a few simple calculations involving your income and debts. Becoming pre-approved lets you:

Shop for a home with the confidence of knowing that you will be able to afford the mortgage.
Write a more attractive sales contract as sellers may give preferential treatment to pre-approved buyers.
Find out about possible qualification problems early in the homebuying process.

In order to be pre-approved you will need to provide your Southern Trust Loan Officer with detailed information and documentation regarding your total financial picture. Your Southern Trust Loan Officer will review your financial situation, discuss mortgage options with you, and if you qualify, provide you with a written letter for a specific loan amount, down payment, and interest rate subject to terms and conditions (i.e. property appraisal).

How long does it take to get pre-qualified or pre-approved for a loan?

Loan pre-qualification can occur in a matter of minutes, in the time required to communicate your financial circumstances to a lending professional so they can crunch the numbers. Loan pre-approval could require up to several days to review the application and file once the applicant's income, asset and credit documentation has been received in full.

What types of problems typically cause delays in the closing date?

This varies from one transaction to another, but the typical closing delays relate to a failure to satisfy loan conditions quickly or a buyer's delay in setting up their homeowner's insurance. The loan condition that most frequently causes problems in the end is a borrowers lack of documentation regarding the source of funds for the down payment and closing costs. Lenders want to see a paper trail of all funds transferred into escrow, and unless a borrower takes the time to document the liquidation, withdrawal and transfer of funds along the way, they must scramble at the end of the transaction to re-create their trail. If the property in question is new construction, building and completion delays frequently occur depending upon weather delays, contractor and sub-contractor problems and the builder/developer involved.

What is the APR and how is it calculated?

APR stands for annual percentage rate and its purpose is to give borrowers a more accurate representation of the effective interest rate on their loan. APR factors in certain closing costs and fees and spreads these costs over the life of the loan, along with the note rate, to arrive at a more accurate figure, which represents the cost of the financing. Your Southern Trust Loan Officer will provide you with a Truth In Lending Statement within 3 days of application that shows the estimated APR. You will receive the final Truth In Lending Statement at closing that shows exact figures.

When and to whom do I make my payments?

Your Southern Trust Loan Officer will advise you when your first payment is due based upon your closing date. You will receive a First Payment Letter and two temporary payment coupons in your closing package. It may take a few weeks for your Lender to complete the initial set up of your loan. If you do not receive a statement or payment booklet before your first payment is due, you MUST make your payment. Use the temporary coupons and follow the instructions from your closing package. Many Lenders transfer the servicing rights of your loan to other investors. This does not affect the terms of your loan; it simply means that another company is responsible for collecting and accounting for your monthly payments. If the servicing rights of your loan are going to be transferred you will be notified in writing of the effective date of the transfer and to whom you should begin making payments. If at any time you have a question about your payment due date or where it should be sent, please contact our customer service department at (800)748-2147.

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