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Gershman Mortgage FAQ


Q: How can I find Gershman Mortgage’s current interest rates?
A: Our current rates can be found on our website under Helpful Links.
Q: What does it mean to “lock in” or “float” a rate?
A: “Locking in” a rate is a process in which a lender guarantees a borrower a specific rate for a certain period of time, even if rates fluctuate during that period. At Gershman Mortgage, you can “lock in” a rate for up to 270 days.When “floating” a rate, the borrower chooses to allow their rate to fluctuate with the market from the time of the application until the closing.
Q: What will my closing costs be?
A: Your closing costs will vary based on the type of loan you have applied for and the number of points. Gershman Mortgage offers a variety of loans that have no closing cost options available. In general, plan for 2-3% of the purchase price. Remember that you’ll also have to pay the down payment at the closing as well as any prepaid items such as insurance. Gershman Mortgage will provide you with a Good Faith Estimate of the closing costs within three days of your application.
Q: What are points?
A: Points, often called discount points, are premiums paid to reduce the interest rate. Each point is equivalent to 1% of the loan amount.
Q: How much will I need for a down payment?
A: Traditionally, down payments were equivalent to 20% of the purchase price. Today, there are a variety of programs that allow down payments as low as 3-5% as well as loan programs that completely eliminate the need for a down payment.
Q: What is an APR?
A: APR stands for Annual Percentage Rate. The APR takes into account points, fees, and the interest rate, making it a good tool for comparing loans.


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Pre-Approval and Pre-Qualification

Q: What is the difference between pre-approval and pre-qualification?
A: Pre-qualification generally involves a less thorough review of an applicant’s credit history and gives a general idea of how much they can borrow. Pre-approval involves a more extensive review and gives a specific amount that can be borrowed. The pre-qualification process can often be completed on-line or over the telephone.
Q: Once I’m pre-qualified or pre-approved, what do I need to do to finalize my loan?
A: In both cases, you’ll need to provide information on your chosen property to finalize your loan. If you’re pre-qualified, you’ll need to provide additional financial information and Gershman Mortgage will need to run a credit check.
Q: Can I apply for a loan before I’ve decided which home to purchase?
A: Yes, to apply for a loan before you have chosen a house, ask to be pre-approved. Gershman Mortgage will run a credit check and give you a specific amount you can borrow. Once you’ve chosen a home, they will finalize the loan. At Gershman Mortgage, you can lock in rates for up to 270 days, allowing plenty of time to find the perfect home.


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Q: How long does the application process take?
A: The time required for the application process will vary based on the type of loan and whether you are pre-approved. Typically, it will take one to six weeks from application to closing.
Q: What information do I need to apply?
A: You will need to provide Gershman Mortgage with information on your assets and debts, employment history, and residential history. View our Helpful Links section for a printable Home Application Checklist of items you’ll need to fill out your application.
Q: Can I start my application on-line at and finish it later?
A: Yes! Once you have registered, you can easily save your application at any time by clicking on the “Save Progress” button at the bottom of the screen. In addition, each time you move to the next page, your work will be saved, protecting you from unexpected power outages or Internet connection failures. To access your application, login on the Apply Online page. Gershman Mortgage also gives you the option of starting your application online and then finishing it over the phone or in person. Call 1-800-437-7462.
Q: What factors are used to determine if I’ll be approved for a mortgage?
A: Lenders look at a number of factors when considering a mortgage application. The main areas are your credit history, savings, earnings, and the property itself.


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Q: What is a cash-out refinance?
A: In a cash-out refinance, the borrower refinances their home for an amount larger than is necessary to pay off the first mortgage. The borrower can use the remaining funds at their discretion. Some popular uses are remodeling, funding a child’s education, higher-yield investments, or a vacation.
Q: When I refinance, will I need to get a new appraisal? What else is required?
A: In most circumstances, you will need to have your home appraised when refinancing. If you have had the home appraised within the last six months by an approved appraiser, Gershman Mortgage may waive the appraisal requirement.
Q: What are closing costs to refinance?
A: All of our loans have closing costs but in many cases we can offer a no closing cost option.


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Q: What is Private Mortgage Insurance (PMI)? What is the difference between mortgage insurance and mortgage life insurance?
A: Mortgage insurance protects the lender if the borrower defaults on the loan. It is typically offered through private companies and referred to as private mortgage insurance or PMI. PMI is typically required on loans with less than 20% down. Government-insured loan programs offer an alternative to PMI. Mortgage life insurance pays off the balance of the mortgage note in the event of the borrower’s death, protecting the family from costly mortgage payments.
Q: Can I cancel my PMI?
A: You may be able to cancel your PMI before your loan is fully amortized depending on the type of loan, conditions in the loan note, the loan to value ratio, and other factors. Some loans require PMI for the life of the loan, while others can be cancelled earlier. Contact the company that is servicing your loan to request a waiver of PMI.
Q: What is title insurance?
A: Title insurance protects the lender from liens, defects, and inconsistencies in the title that did not show up in the title search.


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Loan Programs

Q: Are there benefits to choosing a shorter term over a longer term?
A: A shorter term loan accumulates less interest, costing you less over the course of a loan. The trade-off is that the monthly payments are higher than for a longer term loan.
Q: Does Gershman Mortgage offer any special programs for first-time buyers?
A: Yes, certain government programs offer first-time homebuyers low down payment loans. FHA loans, insured by the Federal Housing Administration, are popular among first-time buyers and anyone can apply for an FHA loan. VA loans, guaranteed by the Veterans Administration, are available only to qualified veterans. Both programs offer low and no down payment options. First-time buyers in Missouri may also be eligible for Missouri Housing Development Commission’s (MHDC) Mortgage Revenue Bond Program.
Q: What are “conforming” and “non-conforming” loans?
A: A conforming loan meets the requirements for purchase by FNMA (Fannie Mae) or FHLMC (Freddie Mac), whereas a non-conforming loan exceeds these limits. Loan limits change annually, based on average sale prices.
Q: What is a jumbo loan?
A: A jumbo loan is another name for a “non-conforming” loan.


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Q: Who will service my loan?
A: Your loan may be sold to a third party. If this is the case, the loan amount, payments, and interest rate will remain the same. You will receive a notice regarding the change as well as a new coupon book. If your loan is sold, you will not be required to pay any additional fees.
Q: What is included in my monthly mortgage payment?
A: Mortgage payments generally include four basic components- principal, interest, taxes, and insurance (referred to as PITI). While principal and interest are paid directly to the lender, taxes and insurance are directed into an escrow account, which the lender uses to pay the annual insurance premium and taxes.

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