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Aaron McClay, Loan Officer
Phone: 612.987.2761
Fax 763.428.8762

Listed below are some factors that affect your Mortgage Rate:

Credit score - a number that is calculated based on your credit history to give lenders a simpler "lend/don't lend" answer when applying for a loan. This number helps the lender identify the level of risk they may be taking if they lend to someone. Basically, the higher your score, the lower your monthly payment.

LTV or “loan to value” - The higher the loan to value on your home, the higher the risk to the investor, which may drive up your rate.



DTI or “debt to income” - In order to qualify for a mortgage, lenders will calculate your debt-to-income ratio. The higher the DTI, the higher the risk for the investor which again will affect your rate.


Assets and Reserves - Assets bring strength to your file. The more assets you have, the better your rate will be.

Conforming and Non-Conforming Jumbo Loans:
The current conforming loan amount is $417,000. Loans over this amount are considered “non-conforming jumbo loans” and have a higher rate that ranges from .125 - .250 percent higher.

Required Documentation to pre-qualify for a loan: With the recent changes in the laws regarding loan programs in Minnesota proper documentation is needed more then ever. If you are planning on building or buying a new home in the near future a Fannie Mae underwritten pre-approval is more important today then ever. Here is a list of some key items you will be asked to provide to your lender.

• 2 most recent pay stubs showing year to date earnings
• Last year’s W2s
• Self-employed borrowers will need to provide 2 years of personal & business tax returns
• Most recent bank or investment statements
• Copy of drivers license and social security card