APR stands for “Annual Percentage Rate” and represents the price you pay to borrow money. APR is a broader measure than interest rate because it includes the interest rate plus other costs such as lender fees, closing costs and insurance. You can use APR to compare loans offered by different lenders when shopping for a mortgage loan.

For example, based on a purchase price of $500,000; loan amount of $400,000 (20% down payment; 80% loan-to-value); interest rate of 4.00% and 1.00% points, the monthly principal and interest payment on a 30-year fixed rate mortgage would be $1,909.66 and an APR of 4.119%. Keep in mind your mortgage loan monthly payment will be higher as lenders typically include proerpty tax and insurance costs.

Ask your ASB Loan Officer for more information about investment properties and second/vacation homes. ASB has many options to help you add to your real estate portfolio.

If you’re getting ready to purchase a second home in Hawaii, there are many factors to consider. Most importantly, you will want to decide what type of mortgage to use for the purchase. Unlike your first home, you may not be able to take advantage of certain loan programs for a second home. First time home buyer loans, for example, usually require a lower down payment than a conventional loan. However, since you are purchasing a second property, you are unlikely to be able to use a first-time home buyer loan to make the purchase and will need to make a sizeable down payment. The best way to learn what you will need to purchase your second home is to speak with a mortgage loan officer with experience in investment properties, like the team at ASB.

There are a couple of items you must consider before applying for a mortgage loan. We recommend that you have a good understanding of how much you want to borrow, what your credit score is, and that your financial information is readily available.

Getting pre-qualified is highly recommended since many sellers require a pre-qualification letter from a reputable lender. Plus, during the pre-qualification process your ASB Loan Officer will help you determine the appropriate price range before you go house hunting.

A residential first mortgage loan is secured by residential real estate property. Therefore, sufficient hazard insurance in case of fire, hurricane, flood and other disasters is required at all times. You must obtain and pay for the premiums if the mortgage loan is for a purchase of a new home; you must obtain sufficient coverage if the mortgage loan is for a refinance of an existing home. After mortgage loan closing and the mortgage loan account is established, an escrow account is used to collect the premiums monthly as part of your mortgage loan payment. A conventional 1st mortgage amount over 80% loan-to-value (LTV) requires private mortgage insurance (PMI), which is paid by the borrower and protects the lender from borrower default on loan payments. PMI cancellation is typically permitted: 1) borrower-requested cancellation, and 2) lender-required cancellation under the Homeowners Protection Act of 1998. For a borrower-requested cancellation, the borrower must provide a written request for cancellation to the lender on the date that the mortgage loan balance is first scheduled to reach 80% of the original value of your home. The law allows lenders to require borrowers to fulfill certain conditions for PMI cancellation.

We typically ask for two years of W-2s and tax returns as well as other documents to verify the information that you provide to us. Every applicant is different, so please contact a loan officer to discuss your situation.