Frequently Asked Questions

When should I get qualified?  
Pre-qualification is an important part of the home buying process and should be done at the beginning. When we pre-qualify you, we help you determine how much of a monthly mortgage payment you can afford, and how much we can loan you based on your current income and debts, employment, available funds, etc. This information will help narrow down your home search. It's short and to the point, and we keep the paperwork to a minimum!

To get an idea of mortgage payments, check out our loan calculators.

When should I refinance?  
Refinancing has a number of benefits that often make the up-front expenditure worth while and can be recouped very quickly in monthly savings. Even a small drop in interest rates can make a big difference in your monthly payments. You may even be able to “cash out” some of the built-up equity in your home, which can be used to consolidate debt, improve your home or take a dream vacation. Talk to a South Central Bank representative about refinancing your mortgage while rates are still low.

What are closing costs?  
There are certain standard costs associated with closing the purchase of a house and the subsequent mortgage. These fees are typically split between the buyer and seller, as spelled out in the sales contract. Buyers will receive a “Loan Estimate” from South Central Bank that spells out the closing costs. The estimate is based on the loan amount, documents that must be recorded and certain inspection and appraisal costs that must be incurred.

     Some typical closing costs included but are not limited to…

  • Loan Origination Fee
  • Appraisal Fee
  • Credit Report
  • Interest and Escrow Payments
  • Property Taxes and Recording Fees
  • Various Insurance Payments

What should I have when applying for a loan?  
     Property Information (if you already have a contract on a house)

  • Purchase Agreement
  • Copy of legal descriptions and MLS sheet
  • If you are selling your current home, copy of listing contract
  • If you have sold your current home, copy of settlement statement (HUD-1)

     Income and Assets

  • Pay stubs for the last 30 days
  • For the past two years:
    • Names and addresses of each employer
    • W-2s
  • Statements for each bank, mutual fund, and/or investment account for the last three months
  • Estimated value of personal property and furniture
  • If you have made any large deposits to your accounts:
    • Explanation and source of deposit
      • If large deposit was a gift:
        • Signed gift letter (lender can supply)
        • Copy of gift check
        • Copy of deposit receipt
  • If you own more than 25% of a business:
    • Corporate or partnership tax returns
  • If self-employed:
    • Tax returns for the last three years (with schedules)
    • Year-to-Date Profit and Loss Statement
  • If you own rental property:
    • Tax returns for the last two years and current rental agreements
  • If you are retired:
    • Pension Award Letter
  • If you receive Social Security
    • Social Security Award Letter
  • If you are counting child support as income:
    • Copy of divorce settlement
    • Copy of twelve months of cancelled child support checks      


  • Names, addresses, account numbers, balances and monthly payments on all current loans
  • Explanation of credit report anomalies, including:
    • Late payments, credit inquiries in the last 90 days, charge-offs, collections, judgments and/or liens
    • Bankruptcy filed within last seven years (bring a copy of your bankruptcy papers)

VA Loans

  • Copy of DD Form 214, Report of Separation


  • Photo ID and proof of Social Security number
  • Residence addresses for the past two years
  • If not a citizen, a copy of the front and back of your green card

Should I buy points?  
A point (which equals one percent -1%- of the total loan amount) is an up-front fee that lowers your monthly interest rate and total interest due over the life of the loan.

You can also purchase fractions of points to fit your current financial ability. If you plan to stay in your home for a long time, it may make sense to pay extra up front and “buy” a lower long term rate.


Which refinancing option is best for me?  
Much of this decision is determined by the purpose of refinancing. If you are refinancing in order to lower your interest rate and monthly payment, it may be better for you to set up a fixed-rate loan for the life of the loan. If you are financing primarily to cash out some home equity, you may want to refinance using the current equity available in the house. There are many different programs and options to choose from. It is best to talk to a South Central Bank representative to determine which program best fits your needs.

What is a “rate lock” period?  
A rate lock or a rate commitment is a lender’s promise to hold a certain interest rate and a certain number of points for you for a specific period of time while your application is processed. This prevents the rate from going up even if the overall market rates increase during that time period.

What is a credit score?  
A credit score is a numerical expression based on a statistical analysis of a person’s credit files, to represent the creditworthiness of that person. Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt. A FICO score is the most widely known type of credit score. 

What are the advantages of fixed rate versus adjustable rate loans? 
With a fixed-rate loan, your monthly payment of principal and interest never change over the life of the loan.  During the early amortization period of a fixed-rate loan, a large percentage of your monthly payment goes toward interest. Gradually more of the monthly payment goes towards principal. Adjustable-rate mortgages typically have a lower interest rate in the beginning with a much shorter lock in period. After that time period has passed, the interest rate is adjusted to reflect the current market conditions and rates.

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