Mortgages 101: Your one-stop blog for mortgage terminology

Welcome to Mortgages 101! This will be a periodic series discussing different aspects of mortgages with the intention of educating buyers about home loans. We’ll talk about the mortgage process and other mortgage basics that every home buyer should know. Buying a home is already a hectic, overwhelming time. The more you understand what will happen and why, the less stressful the home buying and mortgage processes will be.

Before learning about anything, no matter what it is, it’s important to learn the terminology. Maybe not all of it though definitely the words you’ll hear and use the most. These are the 21 most common words you’ll hear when you’re going through the mortgage process.

Appraisal

An expert estimate of the value of the home, condo, or land. An appraisal is completed by a certified professional called an appraiser.

Closing Costs

Fees paid by buyers and sellers in a real estate transaction. Though typically between 2% and 7%, they vary from state to state and transaction to transaction. For instance, a cash transaction will have less closing costs than one in which you are obtaining financing to purchase the real estate.

Conventional Loan

A mortgage that is not insured by any government agency, such as FHA or VA. A conventional loan usually has a fixed rate and terms. Historically, this is the loan that required 20% down; however, there are now many programs that do not have that requirement and are not the low or no down payment loans of FHA or VA.

Debt-to-Income Ratio

A number that measures your monthly debt versus your monthly income. To calculate DTI, divide your monthly debt payments (rent, utilities, credit cards, etc) by your gross monthly income. The number affects the kind of loan you can get as well as your credit score.

Down Payment

A payment made in cash during the purchase of a home. Also called “escrow”, the down payment is typically refundable within a certain time period if certain criteria are met. Initial down payments are usually between 1% and 5%.

Equity

In simplest terms, equity is ownership. When asked, “Who owns this house?”, some people answer, “Me. And the bank.” Equity is the difference between what the house is worth and how much is still owed on the mortgage.

FHA Loan

A loan guaranteed, or insured, by the Federal Housing Administration. Buyers who qualify for FHA loans typically can use a smaller down payment and have some of the closing costs paid by the seller. This loan is designed to help low- to moderate-income borrowers become home owners.

Loan Commitment

A lender’s promise to lend a business or individual a specific amount of money.

Loan Originator

Broadly speaking, your lender. A loan originator is the salesperson or mortgage broker you first speak with. This is the person who takes your information, prequalifies or preapproves you for a loan, and is generally your first point of contact for all mortgage things throughout the buying process. A loan originator works with a team of other mortgage professionals, such as underwriters, loan processors, and coordinators.

Mortgage

A loan from a financial institution, such as a bank, credit union, or mortgage company, that enables you to buy a real estate. The real estate secures the loan.

Mortgage Insurance

Mortgage insurance is insurance which protects the lender if you default on your loan. It is often required on loans in which you put down less than 20%. When issued for a conventional loan, MI will drop off once you pay in 20% on the principle. With an FHA loan, however, MI remains for the life of the loan. An upfront fee of 1.75% of the loan is due up front (or rolled into your monthly payment) while a monthly premium of 0.4% to 1.05% is rolled into your monthly payment

Origination Fee

A fee charged by your lender to cover the costs of processing your loan application. This fee can be anywhere from 0.5% to 2%. Some lenders waive the origination fee, though look for other names such as processing fee, underwriting fee, and application fee.

PITI

An acronym which stands for Principle, Interest, Taxes, Insurance. These are the items which make up your monthly mortgage payment.

Points

Mortgage points or discount points. These are fees you can pay to your lender to “buy down” your interest rate. A lower interest rate usually results in a lower monthly mortgage payment. One point generally costs 1% of your mortgage amount. The amount it buys down your interest rate depends on your lender.

Preapproval

The pre-qualification for a loan. A preapproval is a lender’s offer to loan you a specific amount of money based on specific criteria. The preapproval usually expires after a certain period of time, such as 90 days. When a lender preapproves you, they have substantiated some or all of the information needed from you, such as income and debts.

Prequalification

A step below a preapproval. A prequalification is a lender’s offer to loan you a specific amount of money to buy a house. Unlike a preapproval, a prequalification is based solely on what you tell the lender. A prequalification can be done in a matter of minutes and does not include any verification of the information you give them.

Principal

The amount of your loan; the amount of money you borrowed and have to pay back.

Rate

Interest rate. The rate varies from person to person and is affected by things such as your credit score.

Rate Lock

An agreement between you and your lender to lock in your interest rate for a specific amount of time. You want to lock your rate when interest rates are on the rise, but not if they are trending downwards.

Underwriting

Part of the origination process. In underwriting, the lender determines whether the risk you pose is acceptable enough to loan money to you. In other words, the underwriter looks at your income, debts, payment history, the value of the home you wish to purchase, etc and makes a determination about whether or not they think you will default or not on your mortgage. There are five basic steps to the underwriting process: 1) Prequalification, 2)Income verification and documents, 3) Appraisal of the home, 4) Title search and insurance, and 5) Approved, approved with conditions, denied, or suspended.

VA Loan

A loan available through a program established by the United States Department of Veterans Affairs. VA loans help servicemembers and their surviving spouses purchase a home. The VA determines the terms of the loans and guarantees a portion of the loan.


Check out my home search site at www.realtorcrisintampa.com. On there you can search homes, save neighborhoods you’re interested in, save homes you love, see local recommendations and insights, see school info, calculate commute times and much more.

Interested in an easy-to-use, no-obligation mobile search app? Try my KW app. It’s free! And it works all over the US. Download it now!

7 Reasons Tampa is Your Smartest Move

So you want to move to Florida but haven’t decided where in Florida you think you should settle. That’s a common issue among new Floridians. Unless you have family or friends already living here. The entire state offers unique pros and cons. People who love horses or activities like riding ATVs might prefer a more rural location. Beach lovers will flock to the coasts. As will boaters. Maybe you need a major airport nearby.

What if I told you there’s one city in Florida where you can get all or most of that as well as so much more? Tampa has always been the “little sister” city, so to speak, to Miami or Orlando. Yet, the greater Tampa metro area has so much to offer! Here are seven reasons to consider a move to the Tampa Bay area.

#1 Reason to Move to Tampa = #1 Beaches

TripAdvisor users consistently rank Clearwater Beach as the USA’s #1 beach. In fact, Clearwater Beach has been voted #1 for the second year in a row, and in 2019, St. Pete Beach was voted #4.

Nearby Caladesi Island also consistently ranks as a top beach in the country. Dr. Beach named it #1 in 2009. It has also hit that top 10 list every year since 2016.

Professional Sports Year-Round

The Tampa Bay area hosts professional sports teams in all sports except basketball. We have the Rays (baseball), the Bucs (NFL), the Bolts (hockey), the Rowdies (soccer), and our most recent addition, the Vipers (XFL).

In addition, the Tampa Bay area hosts several major sporting events including the St. Pete Grand Prix (auto racing), the Super Boat Championships, the Valspar Championship (golf), and the Outback Bowl (college football). Plus, five MLB baseball teams come to the greater Tampa metro area for Spring Training – the Yankees in Tampa, the Tigers in Lakeland, the Pirates in Bradenton, the Phillies in Clearwater, and the Blue Jays in Dunedin.

Raymond James Stadium, home of NFL’s Tampa Bay Buccaneers and XFL’s Tampa Vipers. Photo courtesy of Raymond James Stadium.

Move to Tampa for the Entertainment

From art museums to theater to concerts and more, the Tampa Bay area attracts top shows, exhibits, musicians, and artists. Tampa is home to museums such as MOSI (Museum of Science and Industry) and Glazer Childrens Museum. In St. Pete, the Museum of Fine Arts exhibits amazing pieces spanning art from two thousand years ago to the present. The Dali Museum delights visitors as does the glass collections at Morean Arts Center and the Chihuly Collection.

If performing arts are more your style, the Straz Center attracts major Broadway shows including Lion King and Aladdin while smaller theaters bring off-Broadway shows and local productions. Ruth Eckerd Hall is well-known as a stop for classics such as Stomp and Riverdance. Art Harvest in Dunedin is one of the country’s top juried art shows. And the Mid-Florida Amphitheater in Tampa delivers top concerts year-round.

Monet’s Houses of Parliament: Effects of Fog is on display at St. Petersburg’s Museum of Fine Arts.

Find Amusement

Love amusement parks? We’ve got ya covered! Busch Gardens thrills visitors with it’s roller coasters and animal park. It’s one of the most successful manatee rehabilitation centers in Florida as well. Adventure Island, adjacent to Busch Gardens, provides hours of water park fun. Zoo Tampa (formerly Lowry Park Zoo), Clearwater Marine Aquarium, and Florida Aquarium bring wildlife up close while providing an educational experience. If you don’t mind an extra hour’s drive, Legoland in Lakeland is the ultimate kids amusement park. Or head to Weeki Wachee to see Florida’s natural springs and mermaids.

Kids love getting soaked on Busch Gardens’ Congo River Rapids ride, especially on a hot summer day. Busch Gardens and other amusement parks are one of the many reasons to move to the Tampa Bay area.

Experience Other Cultures

Two of Tampa Bay’s favorite cultural experiences are Ybor City and Tarpon Springs. Ybor City was founded by Cuban immigrant cigar makers in the late 1800s and flourished until the Great Depression. It was the only successful town in the southern US to be owned and populated almost entirely by immigrants. The neighborhood still shows off it’s unique architecture and the distinctive Cuban food, including the iconic Columbia Restaurant.

Across Tampa Bay in the small town of Tarpon Springs, you’ll find the large Greek American community in the United States. Though founded by wealthy northerners, it was the Greek sponge divers who gave Tarpon Springs it’s charming character. The town holds the largest epiphany celebration outside of Greece, and Greek influence, including food, dance, and architecture, can be found throughout the town.

Tarpon Springs’ Epiphany Celebration

Small Town Vibes

Tampa’s suburbs have embraced traditional town squares and vibrant downtown areas. Towns like Safety Harbor, Oldsmar, and Brandon host festivals, fairs, and other community events in their downtown corridors. Shops and restaurants attract visitors and residents. We often hear, “We came on vacation and loved it so much we just stayed!”

Many of Tampa’s suburbs exude a small town feel reminiscent of simpler, more neighborly times. When the town gathered for a parade (Dunedin holds the largest Mardi Gras parade outside of New Orleans). When walking and cycling to town were the norm. When neighbors shopped in the local shops and supported local businesspeople. Many of Tampa’s suburbs strive for this kind of environment and the residents (and visitors) love it!

Dunedin’s Pioneer Park is the central location for many of the town’s community events, like the St. Patrick’s Day Street Party.

Move to Tampa for the Affordability

According to a June 2019 article in Business Insider on home affordability, Florida ranks #23 in the country for average home prices at $233,000. However, if you want to find these prices (or lower ones), you’ll likely have to travel into the more rural parts of the state.

As a whole, the Tampa Bay area’s average price lies slightly above that at $254,000. It’s still one of Florida’s more affordable major metro areas. Consider that in Miami the average price is $330,000, in Fort Lauderdale it’s $310,000, and in Naples you’ll pay an average of $335,000. Orlando’s average price is comparable to Tampa’s (but it has no beaches!) and Jacksonville is lower than the state average at $221,000.

Still, when you consider everything the Tampa Bay area offers, it’s definitely worth a look. Especially if you look at more affordable suburbs like St. Pete ($239,000), Clearwater ($220,000), and Tarpon Springs ($150,000).

I could give you another 10+ reasons to move to this area. However, this gives you a good general idea of what the Tampa Bay region offers to residents, businesses, and visitors. If you’re considering a move to Florida, consider a move to the Tampa Bay area. You won’t be disappointed!


Check out my home search site at www.realtorcrisintampa.com. On there you can search homes, save neighborhoods you’re interested in, save homes you love, see local recommendations and insights, see school info, calculate commute times and much more.

Interested in an easy-to-use, no-obligation mobile search app? Try my KW app. It’s free! And it works all over the US. Download it now!

Everything you need to know about home warranties

You just bought a house, and in the negotiations your Realtor suggested you ask for a home warranty. Now you have one and have no idea what to do with it. What is a home warranty? What does it cover? How does a home warranty work? Is it worth the money? These questions flash through your head as you put the brochure and other paperwork away in a file cabinet. Will ever use the home warranty? Let’s hope not!

If you’re confused about home warranties, how to choose a home warranty, and the other questions above, read on. I cover all of these and more in this article. By the end, you should be able to make an informed decision about whether a home warranty is right for you.

What is a home warranty?

A home warranty is a combination of insurance and service agreement. Think of it like the warranty you might get with your car. It is not a homeowners insurance policy, and it is not short-term insurance if anything breaks in the home right after you buy it. Instead, it is a service agreement between the home warranty company and individual service providers which allows for the replacement of certain items within the home in case they break after buying the property.

The annual “premium” varies depending on the extent of the coverage you purchase. Very basic plans can start as little as $400 for the year and go up from there. Very comprehensive plans that include things like pool repairs can cost more than $1,000 a year. Usually, there’s also a service call. Some home warranties also cap the upper limit that they will cover for a repair.

Photo by Milly Eaton from Pexels

What does a home warranty cover?

Home warranties function like most other warranties so it allows you to get repairs and replacements as long as the warranty is in effect. How much it covers depends on the warranty you purchase. Usually, however, it will cover the major systems and appliances in your home. For example, the water heater breaks a couple of months after you purchase the home. A home warranty might cover that, if it’s included in your coverage.

There are also some repairs they don’t cover, unless specifically stated. Because the home warranty is designed for the major systems of your home, it generally doesn’t cover general repairs or maintenance. For example, it won’t pay for fixing the broken window if a baseball goes through it. Or annual preventive maintenance on your HVAC. These will still be out-of-pocket expenses.

How does a home warranty work?

You moved into your new home a few months back. You come home from a long day at work, and your newish refrigerator is not cold. After salvaging as much food as you can, you pull out the home warranty information and call them. The warranty company calls a service provider they are contracted with. The service provider comes to your home, diagnoses the problem, and fixes your refrigerator. If it’s not able to be fixed, you get a replacement fridge. You’re only out-of-pocket the cost of the service call, usually around $75.

Is a home warranty worth the money?

The beauty of the home warranty is not necessarily in the money it can save you, though that’s a plus, too. One of the big advantages is the instant connection to a local, trusted service provider and the coordination of the service. This is particularly useful if you’re new to town and don’t yet have connections with local repairmen. While you could definitely use a service like Angie’s List or Home Advisor, you’ll still be stuck with the cost of the repair.

It’s difficult to say whether a home warranty is worth the $400+ a year it will cost. Like any insurance, warranty, or service agreement, there will be years when you don’t use it at all. And there might be some years in which you use it a lot. This will be also depend on the coverage of your home warranty.

Which home warranty company is the best?

There are so many! I have personally worked with a few different companies. They all cover basically the same things for the same costs. It’s difficult to say how much they cost annually because cost is based on the size of the home, the location, and whether it’s a condo or single family home. All of these companies have online quote systems to make customizing your quote quick and easy.


Check out my home search site at www.realtorcrisintampa.com. On there you can search homes, save neighborhoods you’re interested in, save homes you love, see local recommendations and insights, see school info, calculate commute times and much more.

Interested in an easy-to-use, no-obligation mobile search app? Try my KW app. It’s free! And it works all over the US. Download it now!

About Me

Hey, there! I appreciate you wanting to learn more about me – as a real estate professional, a neighbor, and a person. I’ve posted my “official” bio below. Briefly, though, here some highlights of my life.

  • Obtained real estate license in 2003
  • Mom of one son
  • Florida native
  • Animal lover
  • Plant mom
  • Writing and reading aficionado
  • Kayak paddler
  • Amateur photographer

Now, here’s the official bio you’ll find on all my sites. If you want to know more about me, scoot down below the bio and the photo. I’ve posted 25 Get-to-Know-Me Questions.

“Cristina has been a licensed real estate consultant since 2003. Her experience and knowledge spans many demographics and types of markets. She is equally comfortable working with first time buyers, investors, or luxury clients, and has experience working in sellers markets, buyers markets, and normal markets. In 2009, Cris moved to the Tampa Bay area and has never felt more at home. She lives in a quaint home walking distance to downtown Dunedin. She enjoys the many festivals and fairs in Dunedin as well as the proximity to the water and Gulf of Mexico. During her down time, you can find Cris out kayaking, riding her bike on the Pinellas Trail, trying one of the new restaurants the Bay Area offers, or photographing the many beautiful places around Tampa.”

I took my son to the Florida Association of Realtors convention in August. He enjoyed parts of it, but this wasn’t one of those parts!

25 Get-to-Know-Me Questions

1. What is my middle name? Caridad. It’s Hispanic and means “charity”.

2. What was my favorite subject in school? In high school, my senior year, my favorite subject(s) were my electives. I front-loaded my high school experience so I had five electives in my senior year, and my favorite classes were photography, drafting, and drama. In college, I enjoyed both my economics and my marketing classes.

3. What is my favorite drink? Hands down, water. I love that stuff. And tea, particularly Earl Grey.

On a cold Florida winter day, the Princess likes soft blankies and I like my hot tea.

4. What is your favorite song at the moment? That really depends on my mood. If my brain is frazzled, I reach for something zen, like bamboo flutes. If I’m feeling energetic, however, I might listen to rock, alternative rock, or EDM. The only thing I really don’t listen to is country.

5. What is your favorite food? Salad. I love salad and eat it daily for lunch, sometimes for dinner or breakfast, too. Arugula, spinach, tomato, cucumber, radish, and some kind of protein with olive oil and salt for a dressing.

My favorite kind of salad. I added flowers from our native “weed”, Bidens alba.

6. What is the last thing you bought? Groceries yesterday at lunch time. Flank steak for dinner last night, soup to go with my salad for lunch, and bacon for breakfast today.

7. Favorite book of all time? I have a very old copy of Oliver Wendell Holmes’ book of poetry. That one is probably my favorite because it’s so old and poetry is a favorite of mine.

8. Favorite color? Yellow.

9. Do you have any pets? Of course! Right now we have a dog and a cat. The dog, Hitch, we found running on the side of I-75 about 13 years ago. He’s some kind of terrier mix. He once loved to terrorize squirrels, birds, and lizards in the back yard. Now he just likes to sleep. I figure he’s earned it. The cat, Crystal, showed up on our doorstep in 2014. She thinks she should have her own IG channel. We often call her “Princess” because she acts like one so often.

10. Favorite holiday? Halloween and Christmas. I love to decorate for both, and I love to find the perfect gift to give to people.

11. Have you been out of the country? If so, how many times and where? I have been and enjoy it every time. I’ve been to Canada, Jamaica, Cozumel, Grand Cayman, the Bahamas, Ireland, England, Haiti, Honduras, and Belize. I think that’s it.

12. How many siblings do you have? I have a younger brother.

13. Can you cook? I can, and I love to cook. I even love to cook for many people!

14. Why did you pursue a career in real estate? Initially, it was a way to get out of waiting tables and bartending. I never intended it to be a full time career because I never considered myself a very good salesperson. Over the years, however, it’s something I kept coming back to. Eventually I realized three things:

  1. If you do it right, you’re a real estate consultant or advisor, not a salesperson. It’s a relationship business, not a sales business.
  2. I’m good at it.
  3. I really do enjoy it.

So, I stuck with it and have had the opportunity to work in many roles in the industry which, I think, broadens my experience in ways many other Realtors don’t have.

15. How do you make yourself a priority? I’m still figuring that out! I go to the gym every day at lunch time, meditate almost every night, and pretty much allow myself to not feel pressured to do “something” if I’m tired.

16. What are your hobbies or favorite “other” things to do? So many. So little time! I love photography and take my DSLR camera with me a lot so I can take photos if the mood or subject strikes. Kayaking is one of my favorite activities, especially alone in the morning or evening because the water tends to be calm, and it’s so serene. I’m a big fan of travel and writing and have combined the two into my travel blog, Wander Florida, where I recount our travel experiences around Florida.

17. Favorite thing about your childhood? Looking back… all of it! We lived on a boat that my parents built. Only for a couple of years, but it’s an experience that probably kick-started my love of travel and learning while I travel. We “cruised” up and down the East Coast of the US for 9 months or so, were homeschooled, and were able to have living lessons. We learned about Civil War stuff while in South Carolina, about Ponce de Leon and the first settlement in the US while in St. Augustine, about science by witnessing it first hand, about English and writing by writing and exploring our own personal stories wherever we were. It was an amazing way to learn.

18. Favorite life quote? My soul purpose is serving love.

19. What is your Big Why? I have a couple of them. The first is to travel more. I want to travel to out-of-the-way places and experience those cultures deeply. I’m not interested in the type of travel where you hit 10 countries in 14 days and only see the major tourist attractions. The second is that I’d like to make enough money to be able to give away the majority of it. I want to be able to start a fund or foundation that assists single mothers who have left a difficult marriage to purchase their first home, perhaps through down payment assistance or something similar. I also want to give to animal sanctuaries and rescues.

20. Which is more important: what you say or how you say it? I learned recently that different people “hear” words differently. What I mean by that is that about half of people “hear” the emotion behind the words you speak so for them how you say something is most important. The other people “hear” the words you speak so for them what you say is most important. Therefore, both are important. It’s imperative we learn to read other people to be able to communicate with them in the most effective manner.

21. Do you live to work or work to live? One of the things we say at Keller Williams Realty a lot is “the purpose of business is to fund the perfect life”. So, I work to live. Despite the evil rap that money gets, the reality is that money is really good for all the good things it can do. Work enables us to have more money which means we can fund the perfect life and do more good in the world.

22. Are you religious? If so, what religion? I was raised Catholic; however, I consider myself spiritual, not religious. I’ve read a lot about many different religions, including some of their religious texts and find myself drawn to different aspects of all of them. At the core, however, I believe all religions are born of a need to find answers, acceptance, and love. Whether that is internally or externally very much depends on the religion. For myself, I prefer to find it internally which is more in line with gnostic Christianity, Buddhism, and other such religions, and I believe the world is my church. There is beauty everywhere, if we just allow ourselves to pause long enough to experience it.

23. What was the last thing you did that was really worth remembering? There’s something every day. Yesterday at lunch, several of us in the office sat at a large table in the middle of the office. We ended up having an impromptu mastermind around finances, investing, and the like. It’s worth remembering because we’re an office who, at the heart, is all about sharing ideas and knowledge. And this was the perfect example of that. It’s really wonderful to be able to exchange and explore the many different experiences of some of the top Realtors in the area. It makes us stronger as an office, stronger as individual Realtors, and stronger as work family and friends.

24. When you were a kid, what did you want to be when you grew up? I wanted to ride and train horses professionally. And I did for about 9 years.

My horse, Petey, and I warming up for a class in Wellington around 1992-1993.

25. Who is your celebrity crush? I have two right now – David Tennant and Chris Pratt.


Check out my home search site at www.realtorcrisintampa.com. On there you can search homes, save neighborhoods you’re interested in, save homes you love, see local recommendations and insights, see school info, calculate commute times and much more.

Interested in an easy-to-use, no-obligation mobile search app? Try my KW app. It’s free! And it works all over the US. Download it now!

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