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Home > Financial Services > Mortgage Brokers > Five Star Finance
Five Star Finance
A mortgage broker is an individual or firm that acts as an independent agent for both the borrower and the lender of a mortgage loan. Mortgage brokers are the middleman between you and the lending institution, which can be a bank, trust company, credit union, Mortgage Corporation, finance company or even an individual private investor. A mortgage broker will analyze your financial situation to determine which lender is the best fit for your loan needs. He or she will submit your mortgage application to one or more lenders in order to sell it, and works with the chosen lender until the loan closes. He or she receives a commission from the borrower if the loan closes.
With a variety of loan programs and an established network of lenders behind them, they will find the loan that best suits your needs, at a very competitive rate. They offer conforming, non-conforming and government loan programs. Let Five Star Finance guide you through the home buying or refinancing process, and provide you with the best service available.
Your monthly mortgage payment typically is made up of four components principal, interest, taxes and insurance, together known as PITI. The principal refers to the part of the monthly payment that reduces the remaining balance of the mortgage. The interest is the fee charged for borrowing money. Taxes refer to property taxes your community levies which are generally based on a percentage of the value of your home. The lender usually collects 1/12th of the yearly property tax bill each month.
Lenders won't let you close on your home loan if you don't have to cover your home and your personal property against losses from fire, theft, bad weather and other causes. The insurance amount is collected and paid much like the taxes. Each month 1/12th of the insurance bill is collected and stored in an escrow account until the bill is due. Even if you pay cash for your home, it is a good idea to buy hazard insurance in the event your home is damaged or destroyed.
Principal and interest comprise the bulk of your monthly payments in a process called amortization, which reduces your debt over a fixed period of time. With amortization, your initial monthly payments are largely interest, and as the loan matures, a greater portion of your payment is allocated toward the principal.
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