When I work with a client, my goal is to review my loan planning worksheets to completely communicate the anticipated terms of a loan, the expenses and any escrows that will be included in either a purchase transaction or a refinance transaction.  Some times my worksheets may include more than one option. 

My past customers think this is one of the greatest benefits I give them, which is to know exactly what costs they can expect.  My worksheets are a tool, which allow us to communicate the ‘what if’s’ of a transaction. 

So that you understand the upcoming terms of your transaction with me, here are the highlights of the planning worksheets:

• Please look at Column One and the middle section, labeled Section One, which shows the third party expenses you will have to obtain a home loan.  I try to be slightly on the high side, so you can plan for the accordingly for your scenario.    You can also negotiate the seller to pay some or all of these fees in a purchase transaction, but that is a conversation with your Realtor and will depend upon your final sales price, the Seller's needs, etc. 
• Section Two of the first column shows the anticipated escrows that will be established, including your first year's homeowner’s insurance, your tax escrow account and any pre paid daily interest on your new loan.  I use the middle of the month in this example, but of course, if we close closer to the end of the month, then less pre paid interest is collected.
  
  If your loan is a refinance, then Section Two shows what type of money we need to put into your escrow account of the new loan, so that the appropriate funds will be there when Real Estate Taxes are due or when your Homeowner’s Insurance premium is due.
  
  
• Column Two shows the terms of the loan.  This column shows the interest rate [again, I have tried to be high for planning purposes since we don't know the exact date you are going to lock in your rate], the loan to value, anticipated Real Estate Taxes and estimated home owner's insurance.  Please note in the final box in column two, that a total monthly estimated payment is shown, this one using the monthly PMI [or Private Mortgage Insurance].
  
  
• Combination Loans, if available:
  As an alternative to having monthly PMI, I can generate a combination loan, with an 80% Loan to Value first mortgage [which eliminates monthly PMI], a second mortgage whose value is the difference between what you are planning on putting down and the 80%.  I may or may not show this option to you, as second mortgages are now harder to locate and if available, to approve. 
  
  However, if shown, this column is highlighted in yellow, and the final box shows you the anticipated payment as compared to the monthly PMI plan, which should be less with the combo loan.
  
• Lender Paid / One Time PMI, if available:
  And, in the column highlighted in green, is our 'self insuring' or lender paid PMI loan option.  Like the combo loan, it offers a lower monthly payment than the monthly PMI option shown in column two.  The closing costs are less, typically, and there is only one mortgage holder as compared to two.
  
  

For an explanation of PMI Options on Conventional Loans, click here for my flyer.

• FHA and VA Loans:
  These are Government Insured loans, which offer flexibility in credit underwriting, competitive interest rates and lower down payments with these types of loans.
  
  FHA loans require an upfront MIP premium as well as a monthly premium in every FHA loan.  The upfront MIP premium can be financed into the loan and as I have shown on most of my FHA worksheets, this fee will be financed into the loan, shown in the adjusted loan amount.  The appropriate monthly MIP is shown as well.
  
  VA loans have only one premium, known as the VA funding fee.  This too, can be rolled or financed into the loan, and for planning purposes, I have show this my base planning worksheets.