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Mortgage FAQ

Home Mortgage FAQ

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Do I have to get an appraisal?

Typically, an appraisal is required for all real estate transactions. There is a $550 appraisal fee. (Appraisals are processed/completed by independent firms, FCU has no control over the appraisal process/completion timeline.) If there is a possibility to not have an appraisal, your loan officer will explain that to you.

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How much are my closing costs going to be?

There is a general statement in the mortgage industry that 3% of your requested loan amount is approximately how much you’ll pay in closing costs. Your loan officer will provide detailed closing costs to you based on the specifics of your transaction before you commit to completing the transaction.

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What is the minimum down I need?

Down payment requirements vary by mortgage products. Some programs offer no down payment, but your loan officer will determine if you qualify for those programs.

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What is the minimum credit score I need?

Minimum credit scores vary by mortgage products. Some programs have no minimum credit score requirement, but your loan officer will determine if you qualify for those programs.

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Is a mortgage and a vacant land loan the same thing?

A mortgage loan can be used to purchase or refinance vacant land.

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Do I get a benefit for a first-time homebuyer?

Some programs are intended for first-time homebuyers only, and offer options such as no down payment and/or no minimum score requirements. Your loan officer will determine if you qualify for these programs.

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How long do I have to be at my job to get a mortgage?

A mortgage application requires 2 years of employment history to be included. Consistent employment is one of several factors that demonstrates ability to repay a loan which needs to be considered before we can approve a loan.

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What is an RD loan?

Rural Development (RD) is a federal government program through the USDA (United States Department of Agriculture). Particularly they offer a mortgage program for the purchase of a primary home that requires no down payment. There are income limits (a cap on how much an applicant and their household can make), there are limits on the debt to income ratio, and amount of assets an applicant can have to utilize this program. The home also needs to be in a designated rural area. Your loan officer will be able to determine if you qualify for this program.

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Do I have to make a certain amount of money to get approved for a home?

Income is reviewed in comparison to amount of debts an applicant has. This is called a debt-to-income ratio. We need to verify the applicant makes enough income to cover the debts they already have AND the new proposed mortgage payment.

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Mortgage Rates

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NOTE: Rates are subject to change at any time.

Description	APR*
	as low as
10 Year Fixed†	5.500%
15 Year Fixed†	5.625%
20 Year Fixed†	5.875%
30 Year Fixed†	5.750%
Rural Development	6.000%
5 Year Balloon Construction Loan	Contact Us
10 Year Construction Loan	5.500%
15 Year Construction Loan	5.625%
20 Year Construction Loan	6.125%
30 Year Construction Loan	6.500%
5 Yr. Balloon	7.000%
10 Yr. Balloon	7.100%

*APR=Annual Percentage Rate. Contact us for more information. A loan application fee applies and is included in the APR calculation. FCU Mortgage rates are subject to change at anytime. To get a specific rate, for your individual situation, please contact our Mortgage Department at 989.497.1600.

†Rates are based on a $150,000 loan amount. Rates and fees may vary based on market conditions and are subject to change at any time. Rates are based on a 30 day lock.

Effective Date: January 26, 2023

Our 5 and 10 year balloon mortgages can allow you to amortize your payments up to 30 years.

Home Equity Rates

Description	APR*
	as low as
Closed End Home Equity Max Term 15 yrs or 30 yr amortization with 15 year balloon	7.50%
Prime Gold Home Equity equal to or less than 80% LTV, Prime 4.00% floor of 4.00%	7.50% Rate tied to Prime
Prime Plus Gold Home Equity greater than 80% LTV, Prime 4.00%, floor of 4.00%	8.25% Rate tied to Prime + .75%
MasterCard Gold Home Equity equal to or less than 80% LTV	7.90%
MasterCard Gold Home Equity greater than 80% LTV	8.90%

*APR=Annual Percentage Rate. Rates may change at any time. Must meet FCU's normal underwriting qualifications to be approve. Contact FCU for more information. Loan rates and approval subject to credit score and analysis. A loan application fee applies and is included in the APR calculation for closed-end home equity loans. Equal opportunity lender. For HELOC no fees charged up front and fees are disclosed at time of application. As part of the closing procedures Frankenmuth Credit Union will acquire a security interest in the property. Draws are allowed for 20 years or as long as the account remains open and member is in good standing. Payment in calculated on 1% of the balance or $25, whichever is greater. HELOC rates are variable and based on the current index margin; rate floor is 4.00%APR and will not exceed 25%APR.

Effective Date: January 26, 2023

Neighborhood Mortgage

Neighborhood Mortgage Solutions is a mortgage Credit Union Service Organization (CUSO) that is partially owned by Frankenmuth Credit Union.

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What to Avoid Before Closing

Purchasing a home is an extensive, yet rewarding, process which can last several months. It is very important to maintain your finances from initial application to final closing – avoiding any drastic changes. Here are some tips to assist you as along your home-buying journey.

Maintain your current employment status – Do not quit or change jobs.
Avoid taking on any additional long-term debt, like buying a car or pricey household items, as this will increase your debt-to-income ratio.
Do not increase your credit card usage or miss any of your monthly payments.
Do not change your primary financial institution, as you want to show a steady banking history.
Do not deplete your savings or investment accounts.
Avoid making large deposits into your accounts. Your down payment should ideally be in your account for at least two months.
Be sure to properly manage your debts and liabilities, and represent your income accurately on your loan application.
Do not apply or open new credit or lines of credit, including new credit cards.
Do not co-sign a loan for anybody during this process.

10 actions you should avoid while waiting to close on your mortgage:

Making large purchases: cars, recreational vehicles, expensive furniture
Career changes: quitting or switching jobs
Opening or closing lines of credit
Getting behind on your bills
Failing to answer questions from your lender or broker
Having your credit score pulled
Making large deposits to your accounts other than your regular paycheck
Cosigning on a loan or credit card with anybody
Changing financial institutions
Taking out a payday loan

Mortgage Affordability Calculator

Information and interactive calculators are available to you only as self-help tools for your personal use and are not intended to provide investment or tax advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from a Frankenmuth Credit Union professional regarding all personal finance issues. Call 989-497-1600 or find a branch near you.

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FCU Members Save on Their Insurance.

My Member Insurance Agency (MMIA), an affiliate of Frankenmuth Credit Union, is committed to providing competitive insurance products and exceptional customer service to FCU members. MMIA is excited to help members protect what matters most with affordable insurance solutions for your Auto, Home, Business, Farm, Life and Health.

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