Home Financing Frequently Asked Questions

At Nickel City Funding, we’ve been in the mortgage business for a long while. Our team has found financing for clients with all sorts of needs and unique challenges. We know the mortgage and real estate markets well in North Tonawanda, Hamburg, Amherst, West Seneca, and Lancaster, NY. We take the time to walk each client through different mortgage options; from conventional and nonconventional loans to conforming and jumbo loans, we’ve got you covered. Read on to find answers to some of the most common home financing FAQs we hear and contact us when you’re ready to schedule a free consultation.

What’s the difference between conventional and nonconventional financing?

Conventional loans are fully funded and insured through private lenders. Nonconventional loans are insured and regulated, in part, by different agencies within the federal government, but funded also by private lenders. Gaining approval for conventional financing is more difficult than it is for nonconventional financing; that is, you’ll need a higher credit score, larger down payment and be in better financial shape overall than you would for nonconventional loans. Nonconventional loans, like FHA, VA, and USDA loans, were developed to make financing available to a larger array of clients. They have low or no down payment requirements and have more flexible eligibility requirements.

Who should I talk to first about buying a home?

That depends on what you’re looking for. A mortgage agency is a great place to start, because mortgage agents have connections with other key players you’ll need to work with to buy a home. At Nickel City Funding, for example, we work with top national lenders to provide clients the most competitive rates, and we have several real estate colleagues in the area. We offer preapproval so buyers and their real estate agents can narrow down their home search to include only those homes they can afford.

What documents must I gather to get a mortgage?

Different types of mortgage require different documents, but there is some basic paperwork that most lenders require. They include income statements, W2s and documentation of any other income in the past two years, bank statements and savings account statements for the past two years, any asset statements, and identification such as a passport or driver’s license. If you’re applying for a VA loan, you’ll also need to provide a certificate of eligibility, also known as a COE. Our mortgage agents will tell you exactly what documents you must provide once we determine what type of mortgage is right for you.

How are preapproval and prequalification different?

Both are agreements a lender makes with a loan applicant before signing final closing paperwork. Mortgage prequalification is an estimate of how much financing a borrower may be eligible to receive, but it’s not a legally binding document. Instead, it’s more of a benchmark that a borrower and his or her real estate agent can use to determine which homes to look at. To get prequalified, you’ll need to tell your lender your income, savings, and other financial information, but minimal paperwork is required. Preapproval is a written commitment between a buyer and a lender in which the lender agrees to fund the borrower for a specific amount with a specific rate and term. To get preapproved, you will nee to supply the same type of paperwork you would to close officially on a home. See the question above on which documents you can begin to gather.

We’re Here to Help

We love helping borrowers in North Tonawanda, Hamburg, Amherst, West Seneca, and Lancaster achieve the dream of owning a home. We have answers for any other question you may have about home financing, your eligibility, and the process of buying a home. To get more answers to home financing FAQs or get a no-obligation quote, contact Nickel City Funding today.