F.A.Q Part III

Today is the final installment of our Frequently asked questions. The entire list and much more can be found on our website www.pmg-inc.net.


What is an origination fee?

The origination fee is charged by the lender, and is typically .25% - 2% of the loan amount you borrow. This fee is used to cover expenses during the process of the loan.

What are closing costs?

Fees and costs that both the buyer and seller must pay at closing. They generally include: origination fee, discount point, appraisal fee, credit report, title search, recording fees, inspection fees and other costs described in the HUD I at settlement.

Can I include my closing costs in with my loan?

Yes, typically they are written into the purchase agreement between you and seller. Fannie Mae and Freddie Mac allow a max contribution of 3% and Non-conforming loans allow a maximum of 6% to be contributed to closing costs by the seller.

When will my first payment be due?

Your first mortgage payment is always due the first day of the second preceding month. For instance, if you were to close on March 15th, your first payment would not be due until May 1st. Another example would be if you closed on January 3rd, your first payment would not be due until March 1st.

How do I make my mortgage payment?

Your lender will mail you monthly statements with a payment coupon. Borrowers also have the option of electing EFT (Electronic Funds Transfer) on the 1st, 5th or 10th of the month. Most lenders also have the ability for client to pay by internet or over the phone.

Must I escrow?

That depends on the type of loan and product. All Fannie Mae or Freddie Mac loans with a loan-to-value above 80% require you to establish an escrow account. However, with Non-conforming loans you are given the choice of escrowing or not.

Must I have anything out-of-pocket?

Again this depends on the loan and product. Typically, most Fannie Mae and Freddie Mac loans require a minimum of $500.00 of the borrowers own funds be vested in the transaction.

What is Earnest Money?

These are funds that are deposited along with a written contract and held by a third party (i.e. title agency) to provide leverage/good faith that you have every intention of closing on the desired property.

Must my spouse be present at closing if he/she is not on the loan?

That depends on numerous factors. With Missouri being a community property state both married individuals must sign certain “legal” documents at closing. However, you should consult your title agent or attorney for other options or remedies.


If you have any questions that are not answered on our 3 blogs or on our website, please ask. Just post a comment, email, or call us. We would be happy to help!


Your comments and questions are welcome!

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