MorNext.com Facts    What is MorNext.com?    How is MorNext.com different from other on-line lenders?    What is the MorNext video conferencing feature?    What can I do to help myself financially prepare for a home loan?    Can I get pre-qualified for a home purchase loan before I find my property?    Can I get pre-approved for a home purchase loan before I find my property?    How long will it take to receive a pre-approval after I apply?    Is MorNext.com a direct Mortgage Banker, a mortgage broker, or a mortgage       directory referral source? Credit Information    What is a FICO score?    How can I increase and protect my credit rating?    What if I have a credit problem because of an unusual situation?    How will my credit score affect my loan application? Shopping for a Loan    How do I find the right mortgage?    When should I choose a fixed-rate loan?    When should I choose an adjustable-rate mortgage or ARM?    How does an adjustable-rate mortgage (ARM) work?    What does it mean to rate lock?    What is a point?    When should I pay points on a loan?    What is an Annual Percentage Rate (APR)?    Conclusion What is MorNext.com? MorNext.com is an interactive and informative Internet Loan Center. We combined our 20 years of Mortgage Banking experience with state-of-the-art technology. Our goal: reengineer how mortgage loans are approved and funded. The result: a simplified process that is fast, easy, and affordable. How is MorNext.com different from other on-line lenders? MorNext is different in several important ways. First, we engineered our site to empower our clients. We empowered them with the ability to pre-qualify, approve, track status, and receive loan documentation for their clients online. All this is accomplished without traditional loan officer, processor, and underwriter involvement. Second, Our exclusive video conferencing technology brings a Home Loan Advisor live into the sales process whenever needed. Third, the MorNext approach succeeds in securing the loan approval at the beginning of the process so all parties know immediately what is required to complete the transaction. Other online lenders simply capture borrower data upfront and process the loan in the same, slow traditional manner. This process entails collecting all of the following before a loan decision is made: All borrower documentation Appraisal Title Escrow Instructions Clearly the MorNext approach will achieve new levels of efficiency and customer satisfaction. What is the MorNext video conferencing feature? Our exclusive, state of the art video technology allows the registered client to access an assigned Home Loan Advisor live (both video and audio) for an effective two-way communication. What can I do to help myself financially prepare for a home loan? Avoid making any large credit purchases -- the added debt could impact your ability to qualify for a loan. Manage all outstanding accounts carefully and avoid missing any payments. Contact creditors immediately if you have a concern about your ability to make payments on time. Save money so you'll have a financial cushion in case of an emergency. Can I get pre-qualified for a home purchase loan before I find my property? Yes. In fact, we recommend you do this before you even start looking for a home. A loan pre-qualification will help you determine how much of a home you can afford. Just visit our pre-qualification page and answer a few easy questions. Can I get pre-approved for a home purchase loan before I find my property? Yes. A loan pre-approval takes the pre-qualification process several steps further. A few more questions will need to be answered on your application. You may be required to provide documentation of your income and assets. This documentation may include, but is not limited to, your current paycheck stubs and bank statements. A credit report is also required for a loan pre-approval. How long will it take to receive a pre-approval after I apply? It normally will take approximately 24 hours or less. Is MorNext.com a direct Mortgage Banker, a mortgage broker, or a mortgage directory referral source? MorNext.com is a direct Mortgage Banker, which means we assist you through the entire loan process. A mortgage broker turns your loan over to a third party who approves and completes your loan. A mortgage directory refers your loan to one or more different third parties that complete your loan. Credit Information What is a FICO score? A FICO score is a credit score developed by Fair Isaac & Co. Credit scoring is a method of determining the probability that credit users will meet their obligations. Fair, Isaac began its pioneering work with credit scoring in the late 1950s, and since then, scoring has become widely accepted by lenders as a reliable means of credit evaluation. A credit score attempts to condense a borrowers credit history into a single number. Fair, Isaac & Co. and the credit bureaus do not reveal how these scores are computed. Credit scores are calculated by using scoring models and mathematical tables that assign points for different pieces of information that best predict future credit performance. Developing these models involves studying how millions of people have used credit. Score-model developers find predictive factors in the data that have proven to indicate future credit performance. Models can be developed from different sources of data. Credit-bureau models are developed from information in consumer credit-bureau reports. Credit scores analyze a borrower's credit history considering numerous factors such as: Late payments The amount of time credit that has been established The amount of credit used versus the amount of credit available Length of time at present residence Employment history Negative credit information such as bankruptcies, charge-offs, collections, etc. FICO scores are computed by data provided by each of the three credit bureaus: Experian, Trans Union and Equifax. Some lenders use one of these three scores, while other lenders may use the middle score. How can I increase and protect my credit rating? Here are a few general tips to assist you in raising and maintaining your score: Maintain two to three revolving charge accounts such as Visa or MasterCard in good standing. Have a couple of other credit card accounts such as department stores or gas cards in good standing. Avoid too many credit inquiries; they can lower your credit score. Don't max out your credit cards-the ratio of available credit to your total credit balances is very important. Pay your bills on time or within 30 days from the date they are due. Don't apply for multiple credit lines; it triggers an inquiry of your credit, which lowers your credit score. What if I have a credit problem because of an unusual situation? If you normally pay your bills on time but failed to pay because of an unusual or temporary situation, write a detailed letter explaining the circumstances. Also provide supporting documentation to your explanation, such as a doctor's letter that will add credence to your case. This information will become part of your loan application. Your lender may be able to overlook a credit problem if you can provide a good reason for neglecting your obligation. How will my credit score affect my loan application? Credit scoring plays a significant role when you apply for a loan. Higher credit scores help you to be eligible for more loan options. If you've had credit difficulties in the past, there are still mortgage programs available, but they will usually cost more and will vary depending on the severity of your credit problems. Shopping for a Loan How do I find the right mortgage? Our advanced pre-qualify and loan search site matches your preferences with our large database of loan programs to instantly deliver several loan recommendations. It also allows you to do your own analysis of all the loan products you qualify for so you can make the right decision. If you're still unsure, it's best to consult with a MorNext.com home loan advisor who can provide you with expert advice on the right loan for you and help you through the loan process. When should I choose a fixed-rate loan? A fixed-rate loan offers a borrower the comfort of knowing exactly what their payments will be, month after month, for the life of the loan. Loan terms can range from 15, 20, 25, and up to 30 years. In a low-rate environment, borrowers tend to prefer a fixed-rate product that can protect them from possible interest-rate increases. When should I choose an adjustable-rate mortgage or ARM? Generally speaking, an ARM enables borrowers to secure a loan at an initially lower interest than a fixed-rate loan. This means a borrower has lower monthly payments for a specific period of time when compared to other loan options. Lower monthly payments may allow you to qualify for a higher loan amount. How does an adjustable-rate mortgage (ARM) work? The interest rate on an ARM is tied to a market index and is fixed for a specific period of time. Once that period of time is over, the interest rate is adjusted periodically (every 6 to 12 months) following the changes in the interest rate of index that is associated with the loan. Examples of market indexes include, but are not limited to, LIBOR, Constant Maturity Treasury, and 11th District Cost of Funds. If you are interested in an adjustable-rate mortgage, it is important to discuss all of the features and options of an ARM with your MornNext.com home loan advisor so they can help you make an assessment of the best ARM to meet your specific needs. What does it mean to rate lock? Rate locks are a way of protecting from a possible rise in interest rates during the processing of your loan. You can lock your rate up to any period needed to complete your transaction. Generally speaking, if you choose to lock for an extended period of time, the cost of the loan increases. What is a point? A "point" is essentially 1% of the loan amount. For instance, one point on a $100,000 loan is equal to $1,000. When should I pay points on a loan? The decision to pay points on a loan depends heavily on a borrower's circumstances. In certain situations, it can be very advantageous for a borrower to pay points on their loan. Generally speaking, the longer you plan to keep a loan the more sense it makes to pay points to get a lower interest rate. One way to determine this is to calculate the breakeven point of how long you would have to keep the loan in order to save over the cost of paying points up front. If you are comparing two loans with the same interest rate, and one of them doesn't require you to pay points, then there is no reason for paying points. Another consideration to paying points may be for tax purposes. Points paid on a new home loan are immediately deductible as interest. What is an Annual Percentage Rate (APR)? The annual percentage rate (APR) is an interest rate that is different from the note rate. It is commonly used to compare loan programs from different lenders. The Federal Truth in Lending law requires mortgage companies to disclose the APR when they advertise a rate. Typically the APR is found next to the rate. Example: 30-year fixed 8% 1 point 8.107% APR. It is important to note that the APR does NOT affect your monthly payments. Your monthly payments are a function of the interest rate and the length of the loan. The APR is designed to measure the "true cost" of a loan. An APR does not tell you how long your rate is locked for. A lender who offers you a 10-day rate lock may have a lower APR than a lender who offers you a 60-day rate lock! Calculating APRs on adjustable and balloon loans is even more complex because future rates are unknown. Conclusion Use the APR as a starting point to compare loans. The APR is a result of a complex calculation and is not always clearly defined. There is no substitute to getting a good-faith estimate to compare costs. Ask your MorNext.com Loan Officer for any additional information.