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FAQs

On this page, you will find answers to the most popular mortgage questions of our customers. Didn’t find what you need? Just send us a request.

  • A mortgage lender (like a bank) is the one who actually decides if you qualify for the loan. They review your credit, income, and overall risk, and they make the final decision to approve or deny the loan.
    A mortgage broker doesn’t make the final lending decision. Instead, brokers act as a middleman. They:● Explain loan options from different lenders and shop around to find the best deal for you.● Take your application.● Collect and organize documents (like your credit report, appraisal, employment, and bank info).● Submit the complete file to a lender for approval.
    In short: the lender has the final say, while the broker helps you find the best loan and puts everything together for the lender to review.

  • At Lonestar Home Loans, we’re an independent mortgage broker—which means we work for you, not the bank. Here’s how that benefits you:
    ● More Options: Unlike bank loan officers who can only offer their own products, we partner with multiple lenders to give you access to a wide variety of loan programs.● Better Deals: We shop around on your behalf to find competitive interest rates and terms tailored to your needs.● Personalized Service: Our focus is on you. We take the time to understand your goals and guide you through the process from start to finish.● Less Stress, More Convenience: Instead of filling out applications with multiple banks, we handle the comparisons and communication, saving you time and effort.
    Lonestar Home Loans = Your trusted Texas mortgage broker. We’re here to simplify the process, save you money, and help you achieve your homeownership goals with confidence.

  • Pre-Qualification vs. Pre-Approval
    Pre-Qualification:● This is an estimate of what you might qualify for based on the basic information you provide (like income, debts, and assets).● It usually doesn’t involve a credit check or document review.● Think of it as a quick first look at your borrowing power—but not a guarantee.
    Pre-Approval:● This is a stronger step. A lender (or broker, like us at Lonestar Home Loans) reviews your credit, income, assets, and debts in detail.● You’ll need to provide documents such as pay stubs, W-2s, bank statements, and authorization for a credit check.● With a pre-approval, you receive a letter that shows sellers and real estate agents you’re a serious buyer who can likely secure financing.
    In short:Pre-qualification = quick estimate.Pre-approval = verified proof and a stronger position when making an offer.

  • A rate lock is a contractual agreement between the lender and the borrower. It secures four key components of the loan: the loan program, the interest rate, the points, and the length of the lock period.

  • People usually refinance to save money; either by securing a lower interest rate or by shortening the loan term. Refinancing can also help convert an adjustable-rate mortgage into a fixed-rate loan or consolidate debts into one payment.
    Because there are many reasons to refinance, the decision can sometimes be tricky. If your main goal is to save money, here’s a simple way to figure it out:
    ● Calculate the total cost of the refinance.● Calculate your monthly savings.● Divide the total cost of the refinance by the monthly savings.
    This will give you the “break-even” time; the number of months it takes for the savings to cover the cost of refinancing. If you plan to keep your home longer than that, refinancing will likely save you money.
    Since refinancing can be complex, it’s always best to consult a trusted mortgage professional.

  • Both income and assets are disclosed and verified, and income is used in determining the applicant's ability to repay the mortgage. Formal verification requires the borrower's employer to verify employment and the borrower's bank to verify deposits. Alternative documentation, designed to save time, accepts copies of the borrower's original bank statements, W-2s and paycheck stubs.

  • A loan eligible for purchase by the two major Federal agencies that buy mortgages, Fannie Mae and Freddie Mac.

  • A mortgage larger than the maximum eligible for conforming purchase by the two Federal agencies, Fannie Mae and Freddie Mac.

  • Discount points are a way to buy down your interest rate on a mortgage. You pay the lender extra money upfront at closing in exchange for a lower monthly payment. This can save you money in the long run if you stay in the home long enough to make up the upfront cost.
    In short: Discount points mean paying more at the start to pay less each month.

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