Mortgage FAQs

Find answers to common questions about buying a home, getting a mortgage, refinancing and using your home equity.

What is the difference between mortgage pre-qualification and pre-approval?
Mortgage pre-qualification is an estimate of how much you may be able to borrow based on information you provide, while pre-approval involves a more formal review of your financial information. A pre-approval may help show sellers that you are prepared to finance a home purchase.

How much down payment do I need to buy a home?
The down payment needed to buy a home depends on the mortgage program and your financial situation. Some loan programs may allow a smaller down payment. A First National Bank mortgage lender can help you compare available options and eligibility requirements.

What are mortgage closing costs?
Mortgage closing costs are expenses associated with finalizing a home loan. They may include appraisal, title, recording, prepaid taxes, insurance and other loan-related costs, and your lender will provide an estimate during the mortgage process.

How long does it take to close on a mortgage?
The time needed to close on a mortgage varies based on the loan type, property and documentation required. Your First National Bank mortgage lender can provide an expected timeline and updates as the loan moves through the process.

What is private mortgage insurance (PMI)?
Private mortgage insurance (PMI) is coverage that may be required when a homebuyer makes a smaller down payment on certain mortgage loans. PMI protects the lender if the borrower defaults and, in some cases, may be removed after specific equity requirements are met.

Can first-time homebuyers qualify for down payment or homebuyer assistance?
Yes. First-time homebuyers may qualify for down payment assistance, special financing or other homebuyer programs depending on eligibility. A First National Bank mortgage lender can help identify programs that may be available for your situation.

What credit score do I need for a mortgage?
There is no single credit score required for every mortgage because requirements vary by loan program and other financial factors. A higher credit score may provide access to additional loan options or more favorable terms, and a First National Bank mortgage lender can review your situation.

Can I make extra principal payments on my First National Bank mortgage?
Extra principal payments may reduce a mortgage balance faster and may reduce total interest over time, depending on the loan terms. Contact your First National Bank mortgage lender or servicing team to confirm how additional principal payments should be made and applied to your loan.

Should I choose a fixed-rate or adjustable-rate mortgage?
A fixed-rate mortgage keeps the interest rate consistent for the loan term, while an adjustable-rate mortgage can change after an initial period. The better option depends on your goals, how long you expect to keep the home and your comfort with potential rate changes.

How much house can I afford?
How much house you can afford depends on factors such as income, debts, down payment, credit profile and current interest rates. A mortgage affordability calculator can provide an estimate, and a First National Bank mortgage lender can help you evaluate a comfortable price range. Home Affordability Calculator

What documents do I need for mortgage pre-approval?
Mortgage pre-approval commonly requires documents that verify income, employment, identity and assets, and may also require tax information. Exact documentation varies by borrower and loan program, so your First National Bank mortgage lender can confirm what is needed.

Can I refinance my mortgage and take cash out of my home equity?
A cash-out refinance may allow qualified homeowners to replace an existing mortgage with a new loan and receive part of their available home equity in cash. Eligibility and available equity determine whether this option may be available.

What is a home equity line of credit (HELOC)?
A home equity line of credit (HELOC) is a revolving line of credit that allows qualified homeowners to borrow against available equity in their home. HELOC funds may be used for purposes such as home improvements, debt consolidation or other major expenses.

Can I use home equity to pay for renovations?
Yes, qualified homeowners may be able to use a Home Equity Line of Credit (HELOC) or another home equity lending option to help pay for renovations. The amount available depends on your equity, qualifications and the lending product.