Affording your home

You made it! You have the house, and you have the loan. You have completed the hardest part of the home owning process, but don’t quit now. Keeping a close watch on your mortgage, may save you money and heartache.

Monthly payments

First things first, you will need to arrange to make your monthly installment each month on time. Making your payment late usually subjects you to costly late fees, and you risk harming your credit.

Many lenders offer you the option of setting up your mortgage on an automatic monthly draft from your checking or savings account. Your monthly payment is automatically deducted each month in a timely manner, so that your mortgage stays current.

If you do set up automatic payments, you should continue to review your monthly statement to ensure the payments you are making are accurate. Even the bank can slip up some times, so it is a good idea to verify your payments each month. It is also fun to watch your loan balance steadily decrease.

Another helpful service is online banking in which you are able to keep track of your mortgage online. You can see recent activity on your mortgage and get tax-related information, among other things.

Enroll in Simmons Bank Online Banking.

"Selling" the loan

Some lenders will originate the loan for you and service it, but some lenders do not have the ability to service the loan after it is made. These lenders will “sell” your loan to another lender or financial institution in the secondary market.

Even if your loan is sold, the effect on you will be minimal. Your payments and interest rate will remain the same. You will pay no additional fees. You will be notified that your loan has been sold, and if you are not on automatic payment, you'll receive a new coupon book to make your payments. Make sure to keep any paperwork for your records.

Tax information

One great benefit of home ownership is the possible deduction on your income taxes. Normally, you can deduct the interest you pay on your mortgage from your income taxes. Check with your tax advisor on your specific tax situation. The bank or other lending institution servicing your mortgage should also provide you with information about the interest you pay each year.

Watching your adjustable-rate mortgage

Don’t forget that if you chose an adjustable-rate mortgage (ARM) your interest rate may change at the end of the fixed rate period. Be prepared for the change to affect the amount of your monthly payment, adjusting it up or down.

To determine how much your payment will change, you will need to look at the index that your interest rate is based on and the terms of adjustment on the mortgage including any caps that limit the rate increase. You may want to periodically discuss changes in monthly payments on your ARM with your lender. Your lender will be able to aptly explain when and what the changes will be.

Start your mortgage

Now you know the process. You have walked through these steps, and you are now ready to start on your own mortgage.

Feel free to contact a Simmons Bank Mortgage Specialist near you for help at any time. Find a bank near you. Or, if you still have some unanswered questions about mortgage loans, talk to a mortgage lender.

Talk to a Lender