Florida Mortgages Education Center
Florida Mortgages Education Center - Mortgages can be confusing and the mere thought of applying for a mortgage can strike fear into the mind of any individual who does not understand the ins and outs of the mortgage procedure.
At Solutions First Mortgage Inc. we feel it is better to first try to understand the general publics perceived notion of the terminology involved around real estate and mortgages.
The most common misconception is "I have a Mortgage on my home". This is incorrect the Lender has the mortgage you gave to them. I want to start with the very basics and try keeping the legal jargon out of this and stick with Layman's Terms. In the United States of America we have two types of States in relation to Real Estate and Mortgages. Some states such as Georgia are "title theory" states while most states like Florida are "lien theory" states. In "title theory" states like Georgia the Lender holds title to the property until the loan is paid in full. In "lien theory" states like Florida you hold title.
Now let's just focus on Florida and try to keep it simple, like in a simplified para-phrased opinion and not use it as legal advice like in an attorney's hard core legal version that you could take to court.
- When purchasing a home a seller gives you a deed.
- Once you receive that deed it is now referred to as a title.
So basically when you sell you give a deed.
- On giving the deed you are called the Grantor.
- As the buyer, once you receive the deed it's now referred to as title, you are the grantee, you hold possession. You now hold title, ownership to the property.
Now let us add a loan into this transaction. A Lender gives you a loan for your purchase; you will have to sign a "promissory note" and a "mortgage". The promissory note (generally one to two pages) contains the terms and conditions from the lender for giving you the money.
- The Promissory note is your written promise to pay the lender back.
- The mortgage (generally 20 to 40 pages) is your pledge of the property to the lender. It is you saying to the lender, if you do not pay the loan back you will give the property to the lender.
Since you are giving the lender your pledge (the Mortgage) you are the mortgagor, since the lender is receiving your pledge (the mortgage) the lender is the mortgagee. The lender holds the mortgage and a copy is record in the court records as a lien on the title.
Common variations can be added to a transaction. Most anyone can be on the title, most typical is husband and wife. For our example we will call them Barney and Betty. Now let's say that Betty is the hard charger and the bread winner of the family with good credit. Barney well let's say he likes to watch TV. Now Betty wants to buy a new house (or refinance the one they are living in, results are similar). Betty and Barney can both be on title. Betty will sign the promissory note as she is the bread winner with good credit. But in Florida a Lien theory state both must sign the mortgage. Now with Florida's homestead law even if Barney was not on the promissary note since he is husband to Betty he must still sign the mortgage.
Now you have a basic idea of the three parts of a real estate loan. Deed/Title, promissory note, and mortgage are the basic elements involved in the lending process. This was only point of view of some basic information about real estate loans in Florida and should not be a substitution for seeking legal advice or counsel. It is a good recommendation to use a real estate attorney for your real estate and/or mortgage transaction.
The majority of home buyers do not even begin to investigate mortgage options until they have found a home and placed a down payment on it by which time they are already stressing out and no doubt under pressure form the realtor and the seller to move as quickly as is possible.
This can put you at an immediate disadvantage for getting the right mortgage deal for you. At Solutions First Mortgage Inc. we believe that regardless of your immediate situation you should always have access to the best mortgage available.
We have created our very own mortgage education centre. A place where you can read up on the terminology, learn about the mortgage process and even join us at one of our mortgage classes.
We are aware that you may already be working with a mortgage broker and may decide not to use our services, however we do believe that you should have access to a thorough understanding of what is involved in getting a mortgage.
We have created a number of 'folders' which you can find a little further down the page which contain numerous important sections regarding mortgages, so feel free to investigate as much or as little as you feel that you need in order to make a sensible decision when it is time to choose your next mortgage.
If you have any questions or would like further assistance please contact us directly and we will try our very best to help wherever possible.
Our service has been designed to remove the stress and misunderstandings commonly associated with buying a property. Welcome Home!
For further information about getting the right mortgage for you and to arrange your 'NO-FEE ASSESSMENT'
CALL US on (+1) 941-921-1110