P I T I - Principal, Interest, Taxes & Insurance

Under Construction
For a new construction project, a homeowner will be responsible for property taxes and construction loan interest during the time the house is under construction. Construction loans are often closed out to ordinary mortgages when a Certificate of Occupancy is issued. New home builders should look for construction loans that can be closed into mortgages without additional closing costs being incurred. Property taxes will usually be based on the assessed value of an un-improved, or empty, lot. Check with your local tax assessor for their policy and tax, or millage, rates.

Your builder will be responsible for insurance on the project until the Certificate of Occupancy is issued by your local Building Codes Department. The homeowner should ensure the builder has at least the following insurance coverages:

  1. Builder's Risk insurance (insuring the structure during the construction phase);
  2. Liability insurance covering the cost of persons un-related to building the house being hurt at the construction site;
  3. Worker's Compensation insurance to cover tradesmen injured on the job site;
  4. Performance bond, often a state requirement in lieu of audited personal financial statements, is used to cover claims against builder's quality of construction.

After the C of O
Once a project is complete, most homeowners will incur three basic costs related to home ownership often referred to as PITI:

  1. mortgage payments (interest and often principal: see Financing Your Home on this web site);
  2. insurance (see Homeowner's Insurance on this web site); and
  3. property taxes (check with your local tax assessor's office for current tax rates).

FANNIE MAE
Fannie Mae doesn't lend directly to home buyers but their website is an excellent source of home mortgage information, especially for first time home buyers.

Fannie Mae provides stability, liquidity, and affordability to the nation's housing finance system under all economic conditions. It is a shareholder-owned company with a public mission. Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market.

Fannie Mae has a federal charter and operates in America's secondary mortgage market to ensure that mortgage bankers and other lenders have enough funds to lend to home buyers at low rates. It is the job of Fannie Mae to help those who house America.

VETERANS BENEFITS ADMINISTRATION (VBA)
The VA Loan Guaranty Service is the organization within the Veterans Benefits Administration charged with the responsibility of administering the home loan program. The Veterans Administration home loan guaranty program is designed to assist home-buying veterans by guaranteeing their loans with the mortgage company providing financing for their home.

Q: How do I apply for a VA guaranteed loan?
A: You can apply for a VA loan with any mortgage lender that participates in the VA home loan program. At some point, you will need to get a Certificate of Eligibility from VA to prove to the lender that you are eligible for a VA loan.

Q: I have already obtained one VA loan. Can I get another one?
A: Yes, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior VA loan and disposed of the property, you can have your used eligibility restored for additional use.

COMMERCIAL MORTGAGE SERVICES SOURCES

COUNTRYWIDE HOME LOANS, INC.
Countrywide was founded in 1969 with a commitment to break down the barriers to owning a home. Today Countrywide, America's #1 Home Loan Lender, has helped millions of families find ways to accomplish their home ownership needs, whether buying a first home or refinancing their current loan.

Countrywide has a long standing commitment to lowering the barriers to home ownership and to educating consumers. H.O.M.E. (Home Ownership Mortgage Education) is Countrywide's financial education program designed to provide the knowledge you need to help achieve and retain home ownership.

FIRST NATIONAL BANK
First National Bancshares, Inc. was formed in July 1999 by thirteen local business leaders in order to organize First National Bank of Spartanburg. Its directors are community leaders who have lived in Spartanburg for many years and serve on numerous charitable and service organizations throughout Spartanburg County. The Bank believes its directors' long-standing ties to the community and their significant business experience provide First National Bank of Spartanburg the ability to effectively address the needs of our customers. The bank opened for business on March 27, 2000 in a temporary executive office located at 451 East St. John Street. The main office is now located at 215 North Pine Street in downtown Spartanburg.

Contact Shany Ezell (864)594-5672) or David Harrelson (843) 805-5955 for mortgage information and applications.

WACHOVIA BANK NA MORTGAGE SERVICES
Email: MORTGAGEONCALL@WACHOVIA.COM

WOODRUFF SAVINGS AND LOAN ASSOCIATION
Woodruff S&L is a local lender offering term loans for 15 and 30 Years (Single Family Owner - Occupied Only). No application fee/No appraisal fee for new construction, new purchases, refinancing and debt consolidation loans. For Information call: Jack W. Smith (864) 476-8144.

 
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