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Loan FAQ's
 


How can I obtain a copy of my credit report?
What payment methods are available for my loan?
What is a co-borrower?
Why didn't I qualify for your lowest rate?
Does my name have to be on the account/loan to receive information regarding the status?
What's the difference between a fixed-rate home equity loan and a variable-rate home equity line (HELOC)?
What is a loan to value (LTV) and how is it calculated?
What is a point?
What is Private Mortgage Insurance (PMI)?
What is an APR?


 

Q: How can I obtain a copy of my credit report?
A: Contact the following credit reporting agencies to receive one free copy of your credit report each year.

Q: What payment methods are available for my loan?
A: The following payment methods are available, but may vary based on loan type:

  • Cash.
  • Payroll deduction.
  • Automated Clearing House (ACH) from a checking or savings account at another institution.
  • Internal transfer from a CGFCU Checking or Share Savings account.
     

Q: What is a co-borrower?
A: A co-borrower is someone who applies jointly for credit with the primary applicant and who is equally responsible for repayment of the loan. The payment history on the loan will affect all borrowers.
 

Q: Why didn't I qualify for your lowest rate?
A: Rates are based on the credit score supplied by the credit reporting agency. Your rate may also vary based on the length of your loan or your repayment method.
 

Q: Does my name have to be on the account/loan to receive information regarding the status?
A: We can only release information on a loan to the borrowers or with their written permission to discuss with someone else.
 

Q: What's the difference between a fixed-rate home equity loan and a variable-rate home equity line (HELOC)?
A: Funds for a fixed-rate home equity loan are disbursed at the time of loan settlement. Your repayment is over a specified period of time and your monthly payments are the same for the duration of your loan. The interest rate on a fixed-rate loan remains the same for the term of the loan and will not change.

A variable-rate home equity loan is a line of credit from which you can draw at any time. You can take any amount up to your available limit (min. of $500.00) throughout the draw period. Repayment is based on the balance and term you have left of the loan.

Q: What is a loan to value (LTV) and how is it calculated?
A: The LTV is the relationship between the amount of the home equity loan and the value of the real estate property being pledged as collateral. For example, if you have a home that appraises for $100,000 and you have a $50,000 first mortgage and a $25,000 second mortgage, the two loans together represent a 75% loan to value (LTV).
 

Q: What is a point?
A: A point is a fee, collected at closing, that the lender charges the member in order to obtain either a lower interest rate or a specific program. One point is equal to 1% of the loan amount.
 

Q: What is Private Mortgage Insurance (PMI)?
A: Mortgage insurance is required on all conventional loans where the member either has less than 20% equity in the property in the case of a refinance, or less than a 20% down payment in the case of a purchase. The lender will obtain the insurance and the fee will be included in the members' monthly mortgage payment.
 

Q: What is an APR?
A: The Federal Truth-in-Lending law requires that all financial institutions disclose the APR (Annual Percentage Rate) when they advertise a rate. The APR is designed to present the actual cost of obtaining financing, by requiring that some, but not all, closing fees are included in the APR calculation. These fees in addition to the interest rate determine the estimated cost of financing over the full term of the loan.

 


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