Bank Frequently Asked Questions (FAQs)

Online banking lets you review account history and transactions, transfer funds between accounts, send customer service requests, view cleared checks, pay bills and more.

 Yes. Log in to online banking and select "Account Services" and "Account Names" from the main menu.

Yes. After logging into online banking, select "Customer Profile" and then "Customer Information" from the main navigation to update your e-mail address, phone number or mailing address. Please note that changing your address in online banking will affect only your checking, savings, money market and CD accounts. If you have a Nationwide Platinum Visa Card or accounts with other Nationwide affiliate companies — such as Nationwide Insurance — you must change your address for those accounts separately.

Yes. You can download your account information to view it in Money or Quicken. After logging in to online banking, select "Account Services" and then "Download Account Activity" from the main menu. Choose Money or Quicken from the “Format Type” drop down menu.

 Yes. You can use online banking to view up to 18 months of past statements.

 You can view, print and archive up to 18 months of your statements online. To receive a copy by mail, call Customer Care at 877-I-Bank-NW (877-422-6569) available Monday - Friday, 8 a.m. - 8 p.m. ET. We may assess a small fee for mailed statements.

 Yes. You can transfer to and from any Nationwide Bank Checking, Savings or Money Market Account. You can also use our Money Transfer feature to transfer funds between your Nationwide Bank accounts and accounts you have with other banks.

 Your transaction history builds day by day from the date of enrollment. It holds 3 months of recent account activity.

You have access to all of your Nationwide Bank checking, savings, money market and CD accounts from online banking. You currently cannot view your Nationwide Platinum Visa Card account from Nationwide Bank online banking.

 The change in your balance could appear immediately, depending on which ATM network you have used.

All you need to access and use online banking is a personal computer with access to the Internet, and a browser that supports 128-bit Secure Sockets Layer (SSL) encryption.

 Online banking can be accessed using Windows (95, 98, 2000, XP, and Vista) and Macintosh operating systems.

 No. For now, online banking is available only via personal computer.

Yes. You can download your account information to view it in Money or Quicken. After logging in to online banking, select "Account Services" and then "Download Account Activity" from the main menu. Choose Money or Quicken from the “Format Type” drop down menu.

Online banking supports most current browsers. Be sure you’re using at least Microsoft Internet Explorer 5.0, Netscape 6.0 or Firefox 1.5. If you are using an older version of one of these browsers, you will need to upgrade. For information about the most common browsers, as well as free downloads of their current versions, see:

Microsoft Internet ExplorerNetscapeMozilla FirefoxApple Safari

Select the "Help" option from the browser menu. Then, select the "About" option from the list displayed. The browser version will appear on the dialogue box displayed. 

You are automatically enrolled in online banking when you open a Nationwide Bank account online. If you have lost or forgotten your username or password, you can call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET, to speak to a Customer Care Representative.

 Enrollment in online banking is part of our account opening process. To open an account, use our online application or call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET.

 A Customer Care Representative can provide your online banking username and password. Please call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET.

When you open any Nationwide Bank account online, you are automatically enrolled in online banking. All you need to start is your username and password. If you already have an account but need your login information, call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET to speak to a Customer Care Representative.

You will have access to funds in your new deposit account once you fund the account, receive the fulfillment package and return the signature card bearing the signatures of all account owners.

Standard e-mail is not secure because it uses unsecured Internet connections. When you send a communication via the online banking Message Center, your message is secure because it is sent directly from your computer to Online Banking over a secured connection. If you communicate with us via an e-mail program other than Message Center, be careful that you do not send information such as your account numbers or Social Security number.

You can send us a secure communication via the online banking Message Center. If you prefer, you can call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET, to speak to a Customer Care Representative.

All of your Nationwide Bank checking, savings, money market and CD accounts are listed in your account summary. Accounts you may hold with other Nationwide affiliate companies — such as Nationwide Insurance — cannot be added to your account summary at this time. You cannot currently view your Nationwide Platinum Visa Card account from Nationwide Bank online banking.

Call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET, to speak to a Customer Care Representative. 

 If you opened your account online, you selected a username when you created your account. If you lost or forgot your username, call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET to speak to a Customer Care Representative.

Make certain you’ve entered your username and password correctly, including upper- and lowercase letters. If you are still unable to access the program, it's easiest to use the "Forgot Password" feature on the login page to have your password sent to your personal e-mail account or to change your password permanently. You can also get help from a Customer Care Representative by calling 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET.

You can send us a secure e-mail communication from the online banking Message Center. Or, if you would prefer, you can speak to a Customer Care Representative at 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET. You will need the following information:

The name and account number of the person or company you would like to pay

The amount of the payment

The date for which the payment was scheduled

Yes. You can download your account information to view it in Money or Quicken. After logging in to online banking, select "Account Services" and then "Download Account Activity" from the main menu. Choose Money or Quicken from the “Format Type” drop down menu.

 If you enroll in online bill payment and decide not to use it, nothing will happen. However, if you're inactive for a long time, you may be notified that the service will be de-activated if you fail to begin using it.

Any person or company to whom you could send a check for payment is eligible for payment through online bill payment. Individuals or businesses which reside outside the United States are not eligible for bill payment.

 After you enter a bill payment request, you can review the status of the payment via the Payment Activity screen. If the payment has not yet been processed, you have the ability to modify or cancel the item. If these features are not available, it indicates that the payment has already been processed.

Yes. Using the "Single Payment" feature, you can enter any date you choose – today or a future date. Whatever date is entered into the Payment Date field is the date the process will begin.

 For all bill payment requests, you must enter a payment date. This is the date that we begin the bill payment process. We will take the funds from your account on the business day following the scheduled payment date. You should schedule the payment date for at least five days before the due date of your bill.

 It normally takes five business days from the time we begin the process. The process will begin on the payment date you specify. (For example, if you request a payment with a payment date of Tuesday, the payee will receive the payment by Wednesday of the following week.)

You can view your past payments in the system to see if a specific payment has cleared.

 If you do not have sufficient funds in the account (or in a linked Nationwide Bank account if you have activated overdraft protection) on the day we attempt to collect the funds, the payment will not be made. The item will also appear as “failed” in your payment history.

 Bill payment requests made before 12:00 a.m. are processed the same day the request is made. (Funds will be debited from your account the following business day.)

 You can change payments while they are in a pending state.

 Bill payments must be for at least $1 and can not exceed $10,000.

 The bill payment amount will be debited the business day following the payment date you entered.

 You can schedule a payment even if you do not have sufficient funds in your account. Funds are deducted from your account on the pay date you selected when scheduling the payment. If there are not enough funds to cover the payment on the pay date, your account will be overdrawn. This may result in an overdraft. If you have elected to enable overdraft protection, we will attempt to draw the funds from your linked savings account.

 We offer Nationwide Direct Checking and Nationwide Interest Checking, both of which can be opened online. We also offer Nationwide Restoration Checking to recipients of property and casualty proceeds from Nationwide or its affiliates.

 We offer Nationwide Regular Savings, Nationwide Money Market and Nationwide CDs – and you can open any of them online.

 Nationwide CDs are available in the following terms: 3 months, 6 months, 1 year, 2 years, 3 years, 4 years and 5 years.

Nationwide Direct Checking: $50

Nationwide Interest Checking: $50

Nationwide Regular Savings: $50

Nationwide Money Market: $1,000

Nationwide CDs: $500

 Yes. Nationwide Direct Checking does not require a minimum balance and has no monthly maintenance fee with direct deposit.

 Yes. All of our checking accounts include unlimited check writing.

 Yes, all of our checking accounts include a Visa debit card with no monthly service fee.

 Yes. You can use one or more linked savings accounts to cover overdrafts on your checking account.

 Yes. All of our checking, savings and money market accounts include money transfer services. You can use our free money transfer service to transfer funds between your Nationwide Bank accounts and from your accounts with other banks.

A Nationwide Money Market account allows you to earn a more attractive interest rate and write up to three checks per month. Savings accounts have a lower interest rate and a lower balance requirement and do not provide the ability to write checks against your balances.

Yes, money market deposit accounts (not to be confused with money market mutual funds) are considered bank deposits and are insured by the FDIC. Money market deposit accounts are insured at the same limits as traditional savings or checking accounts.

By default, your Nationwide CD will be renewed at maturity. You will receive a notification of your CD maturity 30 days prior to renewal. If you don’t want to renew, you can either withdraw your funds on the maturity date (or within the 10-calendar-day grace period), or send a written request to us at:

Nationwide Bank
P.O. BOX 182049
Columbus, OH43218-2049

Use the online Visa application, or call 1-888-211-9095 to apply.

 Yes. The Nationwide Platinum Visa Card offers Flexible Rewards^SM. For more details, see the full benefits of the card.

 No. There is no annual fee.

 Yes. Transfer your balances from higher-APR credit cards up to your Nationwide Visa Card credit limit. You'll save money and have fewer bills to pay.

Your Nationwide Platinum Visa Card includes online banking through CardMember Services. You cannot currently access your credit card account from Nationwide Bank online banking.

Yes. Your Nationwide Bank Visa debit card works at over 400,000 ATMs across the country.

The Visa debit card is not a credit card. You can use your debit card to make purchases anywhere you see the Visa logo, but unlike a credit card, purchases are deducted directly from your checking account and detailed on your monthly statement. Your purchasing power is limited to available funds in your checking account and there are no finance charges to pay. 

The Visa debit card can do everything that a traditional ATM card can do and more. You can use the card to obtain cash and account balances at ATMs worldwide and to purchase goods and services anywhere the Visa logo is displayed. 

No, there are no monthly or annual fees for the debit card. 

There are no fees for using your Visa debit card. However, account transaction fees and/or non-Nationwide Bank ATM surcharges may apply when using your Visa debit card at an ATM. For a detailed discussion of ATM fees and surcharges – and how you can avoid them – visit the ATM Banking page.

No. Simply swipe the card or give it to the sales person and then sign the receipt. 

When you use the Visa debit card for purchases at a merchant featuring the Visa logo, you do not need to provide a personal identification number (PIN), while an ATM or direct debit point-of-sale transaction requires that you key in your PIN. 

As soon as you discover your card is missing, contact Customer Care at 1-877-I-Bank-NW (1-877-422-6569). We will cancel your card and issue a replacement.  

Security verifications can be performed only for residents of the United States. Therefore, all new applicants must have a valid U.S. address and verifiable tax identification number.

All applicants for individual accounts and joint with right of survivorship accounts must be at least 18 years old. However, if the account application is for a minor custodial account, the primary signer must be at least 18 years old. The secondary signer can be any age. Checking accounts are not eligible for the minor custodial ownership title. To apply for a minor custodial account, call 1-877-I-Bank-NW (1-877-422-6569) Monday – Friday, 8 a.m. – 8 p.m. ET.

We offer the same products online and over the phone. You can apply online or by phone to open an individual or joint account with Right of Survivorship and with up to three co-signers. If you wish to open a trust or custodial account, please call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET.

Look at the bottom left corner of your checks. The first sequence of numbers, usually a nine-digit number, is your bank routing number.

The bank routing number is also known as a routing and transit Number (RTN), bank number or American Bankers Association (ABA) routing number. It was established by the American Bankers Association to identify the account holder’s bank – for example, Nationwide Bank – when processing checks or depositing money to an account.

The American Bankers Association (ABA) routing number directs electronic deposits to the proper bank. This number is usually the nine digits that precede the account number printed at the bottom of a check or personalized deposit slip.

We accept deposit account applications only from people who reside within the United States and who have valid U.S. tax identification numbers (Social Security numbers).

The deposit application contains fields requesting the following personal information for both the applicant and all co-applicants:

First Name, middle initial and last name

Social Security number

Date of birth

Mother's maiden name

Home address (street, city, state, zip)

Home telephone number

Employer's name, city and state

Identification (driver license, state ID, passport number and expiration date).

Bank and account number for the account you will be using for your opening deposit to create your Nationwide Bank account.

If you are already a Nationwide Bank account holder, you will be asked for your online banking username and password.

 Submitting an account application will only take a few moments of your time. Applicants will receive a package containing the account opening documents and disclosures within five to seven business days of the application date. You will receive your checks and ATM/debit card within five to seven days after the account is funded.

You can open any accounts online or by phone:

Nationwide Direct Checking Nationwide Interest Checking Nationwide Regular Savings Nationwide Money Market Nationwide CDs (Certificates of Deposit) Nationwide Platinum Visa Card

 

 

 Enrollment in online banking is part of our account opening process. To open an account, use our online application or call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET.

Call 877-I-Bank-NW (877-422-6569) Monday - Friday, 8 a.m. - 8 p.m. ET, to speak to a Customer Care Representative. 

Look at the bottom left corner of your checks. The first sequence of numbers, usually a nine-digit number, is your bank routing number.

The bank routing number is also known as a routing and transit Number (RTN), bank number or American Bankers Association (ABA) routing number. It was established by the American Bankers Association to identify the account holder’s bank – for example, Nationwide Bank – when processing checks or depositing money to an account.

The fastest way to fund your new account is to electronically transfer funds from a deposit account at Nationwide Bank or another financial institution. If you prefer, you can also fund your new account by mailing us a check.

You will receive your new account package within five to seven business days after submitting your application.

If you have a question about your application, please call 1-877-I-Bank-NW (1-877-422-6569) Monday – Friday, 8 a.m. – 8 p.m. ET, to speak with a Customer Care Representative.

You will have access to funds in your new deposit account once you fund the account, receive the fulfillment package and return the signature card bearing the signatures of all account owners.

A Nationwide Bank Money Market account allows you to earn a more attractive interest rate and write up to three checks per month. Savings accounts have a lower interest rate and do not provide check access.

Yes, money market deposit accounts (not to be confused with money market mutual funds) are considered bank deposits and are insured by the FDIC. Money market deposit accounts are insured up to the same limits as traditional savings or checking accounts.

You can use your ATM or debit card at over 400,000 ATMs across the country and thousands more worldwide. To find an ATM, visit our ATM locator.

Nationwide Bank may charge you a fee if you use a non-Nationwide Bank ATM – that is, one that Nationwide Bank does not own or operate –to perform transactions. A surcharge is a fee imposed by the owner of the ATM. For a detailed discussion of ATM fees and surcharges – and how you can avoid them – visit ATM Banking.

Yes. Your Nationwide Bank Visa debit card works at over 400,000 ATMs across the country.

A non-Nationwide Bank ATM is any ATM that Nationwide Bank doesn't own or operate.

Yes. We will send you an ATM card at your request. To request an ATM card for your account, send us an e-mail from the Message Center in online banking or call 1-877-I-Bank-NW (1-877-422-6569) Monday – Friday, 8 a.m. – 8 p.m. ET.

To establish direct deposit with your employer, complete this form (PDF) and provide it to your employer.

Simply call 1-800-772-1213. Provide your Social Security number and account information (your account number and Nationwide Bank's routing and transit numbers) to the Social Security Administration to establish direct deposit.

Look at the bottom left corner of your checks. The first sequence of numbers, usually a nine-digit number, is your bank routing number.

The bank routing number is also known as a routing and transit Number (RTN), bank number or American Bankers Association (ABA) routing number. It was established by the American Bankers Association to identify the account holder’s bank – for example, Nationwide Bank – when processing checks or depositing money to an account.

For savings and money market accounts, you can make an unlimited number of withdrawals at the ATM or branch. However, you are limited to 6 preauthorized, telephone or computer transfers per monthly statement period, with no more than 3 of the 6 by check or point-of-sale. Click for more details.

No. Only accounts for which you are the verified owner will be accessible from online banking. If you have a checking account, you may be able to send a payment using online bill payment instead.

Yes. You can select to have your funds transfer processed immediately or at a future date.

  Bank accounts are immediate. Transfers to or from your external accounts are processed daily and can take up to 5 days to clear, although they normally take 3 days.

Yes. You will be required to complete a one-time verification of account ownership prior to transferring funds

The amount you may transfer varies by account: 

• Direct checking, interest checking, regular savings, money market: $500,000 per transfer
• Restoration checking: $1 million per transfer.

You can transfer funds to or from the following types of accounts: checking, savings and money market accounts. You cannot transfer funds to or from a CD account. 

You can use our 24-Hour Phone Banking to:

Check your account balance Review recent transactions Search your transaction history See if a check has cleared Transfer funds between your Nationwide Bank accounts Review how much interest has been paid to your accounts

In order to use 24-Hour Phone Banking, you'll need your Social Security number and PIN. If you opened your account online, you created your PIN as part of the application process. If you don’t know your PIN or need to create one, a Customer Care Representative can help.

 Yes. You can access your Nationwide Bank accounts over the phone 24 hours a day, seven days a week. Just dial 1-877-I-Bank-NW (1-877-422-6569).

Nationwide Bank online banking is available 24 hours a day, seven days a week.

 Nationwide Bank offers online banking as a free service to all our customers.

 With online banking from Nationwide Bank, you can conduct all your usual banking transactions via the Internet, including:

Checking current balances and account activity on all your Nationwide Bank accounts Transferring funds between your Nationwide Bank accounts as well as other banks Scheduling and paying bills through online bill payment Accessing up to 18 months of online account statements (e-statements) Viewing, printing and saving images of cleared checks Sefnding and receiving secure messages online through the Message Center

Nationwide Bank stores all of your account information and history, so even if your computer crashes, your information is safe and secure. If for any reason your computer is unavailable, 24-Hour Phone Banking provides you with many of the same features available in online banking. Bill payment, however, is available online only.

Your account activity and available balance are updated soon as transactions are completed throughout the day.

Yes! Our experienced staff is available to discuss your refinance needs between 8 a.m. and 9 p.m. ET, Monday through Friday. Contact one of our mortgage agents by email at production@nationwide.com or by telephone at 1-800-811-5385 for mortgage information about our loan products and competitive interest rates.

Prior to selling your home, contact our Assumption Department at 1-800-356-3442 or by e-mail at custserv@nationwide.com for additional information and to determine if your loan is assumable.

Your payment is due in our office on or before the due date (generally the first of each month). It is considered late the following day. The time between the due date and the assessment of a late charge, normally 15 days, is a convenience to allow for such things as mail delays, weekends and holidays.

Nationwide Advantage Mortgage does not consider the postmark date. According to your mortgage documents, the date we receive your payment is the date we use to determine whether a late charge is assessed. All payments are processed the day received. Any payments received on or after the late payment date noted on your coupon (generally the 17th) will be assessed a late charge.

Many tax authorities will mail an informational copy of the real estate tax statement to the homeowner in addition to the mortgage company. Generally, Nationwide Advantage Mortgage does not require you to mail real estate tax statements to our office for payment. However, there are some statements tax authorities don’t forward to the mortgage company, and in special cases we’ll need your assistance in obtaining the statement. If you receive a statement for any of the following, please forward it to our office by mail or fax.

Delinquent real estate taxes Supplemental or additional real estate taxes Special assessments If you reside in a homeowner area or if the tax authority won’t honor a statement request from another party If you have a mortgage in Wisconsin or North Dakota and wish to have your taxes paid by the end of year

There may be several reasons. Some mortgages, such as ARM loans, provide for periodic adjustments to your principal and interest payment amount. A second reason for a change may be due to an annual analysis of your escrow account. In compliance with the Real Estate Settlement Procedures Act (RESPA), you’ll receive an Annual Escrow Disclosure Statement, which shows the adjustment to your escrow payment based on current tax and insurance amounts.

There may be several reasons. Some mortgages, such as adjustable rate mortgage (ARM) loans, provide for periodic adjustments to your principal and interest payment amount. A second reason for a change may be due to an annual analysis of your escrow account. In compliance with the Real Estate Settlement Procedures Act (RESPA), you will receive an Annual Escrow Disclosure Statement, which shows the adjustment to your escrow payment based on current tax and insurance amounts.

Common reasons for escrow payment changes are:

Your hazard insurance premiums may be adjusted if you change the type of your insurance coverage, or if your insurance rate is adjusted. If you have any questions about your insurance, contact your insurance agent. Real estate taxes may be adjusted due to changes in the assessed value of your property, tax rate changes, or changes in exemption status (i.e. homestead, veteran, tax abatement, etc) The property owner is responsible for filing exemptions. Contact your local taxing authority for information regarding your taxes.

If the anticipated required balance on the Annual Escrow Disclosure Statement is greater than the reserve allowed, there is an escrow surplus. This surplus will be refunded within 30 days of the analysis date, if the account is current. If the required balance on the Annual Escrow Disclosure Statement is less than the reserve allowed, there is a shortage. The shortage will be divided by 12 and added to your payment for the next 12 months.

You may pay the shortage in full and have your new payment amount reduced by the amount of the monthly shortage (one-twelfth of the total shortage). To do this, send your check to the address shown on the Payment Methods page in your coupon book, indicating it’s for payment of the escrow shortage. If you pay by Auto-Debit, the shortage must be received at least four business days prior to your normal payment withdrawal date so the payment amount can be reduced.

When a loan is originated, the mortgage documents specify the escrow conditions. Lenders are required to establish escrow accounts for all FHA insured mortgages. This has become a standard practice for all mortgages, including VA and conventional mortgages. The interest rates quoted to borrowers are normally based on lenders collecting escrows. Once an escrow account is established, it continues for the life of the loan.

Yes. Should you sustain a loss to your property, the insurance company will make the loss of proceeds check payable to you and Nationwide Advantage Mortgage Company as mortgagee. When you notify us, we’ll explain how we monitor the disbursement of claim proceeds to insure the property gets repaired to its original condition.

The number of days from application to closing can vary from a few days to 45 or more days, depending on a number of factors. Some of the factors are loan type, whether an appraisal is needed and title clearance. Time delays also occur if outside sources or the borrowers don’t provide documents to the lender promptly.

Nationwide Advantage Mortgage can generally close a loan within 25 days, although there are occasions when we can close a loan within a week. 

Generally, the process takes as long or short as the borrower wishes. Explaining and signing the documents takes approximately 15 to 20 minutes. However, the borrower may choose to sign the documents and be on his/her way or ask a number of questions and spend more time. Closings may also vary from state to state or closing agent to closing agent.

Yes. Our experienced staff is available to discuss your refinance needs from 8 a.m. to 9 p.m. ET, Monday through Friday. Contact one of our mortgage agents by e-mail at production@nationwide.com or by telephone at 1-800-811-5385 for information about our loan products and competitive interest rates. You may also analyze various financing possibilities or make an application at this time.

The mortgage you currently have involves a series of legal documents, which in most cases don’t provide for a reduction or change of interest rate. If this is the case, one way to lower your interest rate is to obtain a new mortgage and pay off the old mortgage. Most fixed rate mortgage instruments today are like this since the majority of these mortgages are used to create mortgage-backed securities.

If your mortgage has an option to modify its terms, you may want to compare the terms of the modification to current refinance rates and costs before finalizing the modification. In some cases, a new refinance can be the better (less expensive) option over the modification.

When the borrower chooses to lock-in the interest rate, the lender takes the risk of interest rates increasing during the period of time from lock-in to loan closing. The down side is if interest rates fall, the borrower is locked in at the higher interest rate. The benefit is the security of knowing the interest rate is locked in if interest rates should increase.

When floating the interest rate for any amount of time, the borrower takes the risk of interest rates increasing during the period from application to the time of lock-in. The downside to this, of course, is if interest rates increase during this time, the borrower is subject to the then current higher interest rates. The benefit would then be if interest rates went down, the borrower would have the option of a lower interest rate than if locked in previously.

The decision of whether to lock-in or not is a personal choice. The borrower needs to decide just how much risk to take.

This question is best answered after careful consideration of your own personal financial goals. Buying down the interest rate (paying points on the mortgage − one point is one percent of your mortgage amount) may not be in your best interest. Here are some reasons why:

Mortgage interest paid is tax deductible in most cases (seek the advice of an accountant or the IRS). The funds are no longer available to invest, save or use (i.e. purchase an IRA, pay off credit card debt at a higher rate, etc.) You can take advantage of falling interest rates sooner if discount points aren’t paid to buy down the interest rate (the original interest rate was higher). In the past, if a consumer bought down the interest rate and then refinanced (buying down the rate again), it’s possible not enough time will have elapsed to recover the buy-down amount through the reduced monthly payment. This also occurs if the consumer sells the home before recovering the buy-down amount. Not only does the amount paid in discount fees (buy-down amount) need to be recovered, the time value of the money spent or its present value also needs to be recovered. Present value is the income you could have earned or the satisfaction you could have received through alternative use of your money. Remember to consider the tax consequences of your ultimate decision.

Individuals should do what best fits their own personal situation and goals.

In many cases they are, however, Nationwide Advantage Mortgage Company^SM is not a tax advisor. Therefore, we recommend you contact your tax preparer or the IRS to obtain a qualified opinion on the deductibility of discount points.

Prepaid interest is typically paid at loan closing. It’s the interest paid on a new loan from the day of closing through the end of the month. All future interest on a mortgage loan is then paid in arrears. For example, if your new loan closes on February 19, prepaid interest would be paid at closing from February 19 through the end of the month of February. Interest would then be paid monthly with your first payment beginning April 1, which would pay March interest. Your payment on May 1 would pay April interest, etc.

All lenders are required by the Real Estate Settlement and Procedures Act (RESPA) to show the rate which will be charged on the note signed at closing, including the total cost to obtain the loan. This includes, but is not limited to, the total interest paid over the life of the loan, assuming the full term is carried out at the note rate, plus certain closing costs. Closing costs could include prepaid interest, Private Mortgage Insurance/FHA Mortgage Insurance Premium or VA Funding Fee, whichever may be applicable, and various miscellaneous costs such as an underwriting fee, tax service fee, etc., as may be charged by the lender. All of these finance charges are taken into consideration when calculating the APR to give a more accurate picture of the total cost of the loan.

When borrowers make their monthly mortgage payments, they generally also pay one-twelfth of the anticipated annual amount needed to pay taxes and insurance premiums. These additional funds are deposited into an escrow account (also known as an impound account), until the lender pays the taxes and insurance premiums as they come due. The borrower benefits for budgeting reasons because costs are spread through the year rather than as a lump sum. This allows the lender greater control in avoiding tax delinquencies or lapses of hazard insurance coverage on the property. Mortgage documents often require that lenders establish an escrow account.

 

The Real Estate Settlement Procedures Act (RESPA) sets standards for the calculation of the amount mortgage lenders require borrowers to deposit into the escrow account. RESPA limits the initial deposit into an escrow account to an amount equal to the sum sufficient to pay taxes, insurance premiums and other charges on the mortgaged property for the first payment period, plus a cushion.
An escrow cushion is an amount of money held in the escrow account to prevent the account from being overdrawn when increases in disbursements occur.

On a monthly basis, mortgage lenders may not require borrowers to pay more than one-twelfth of the total amount of the estimated annual taxes, insurance premiums and other charges, plus an amount necessary to maintain the allowable cushion.

When a loan is originated, the mortgage documents specify the escrow conditions. Lenders must establish escrow accounts for all FHA insured mortgages. This has become a standard practice for all mortgages, including VA and conventional mortgages. The interest rates quoted to borrowers are normally based on lenders collecting escrows. Occasionally on conventional loans, Nationwide Advantage Mortgage waives the collection of escrow requirement at closing by collecting a fee to compensate for the lost value of the escrows. Once an escrow account is established, it continues for the life of the loan.

Prior to the existence of mortgage insurance, individuals couldn’t typically buy a home unless they had at least a 20% down payment. Mortgage insurance benefits the mortgage lender directly by reducing the costs associated with borrower default. It also benefits consumers by lowering down payments, thereby allowing more people to achieve homeownership.

FHA insured mortgages require mortgage insurance premiums (MIP) and conventional loans with a loan-to-value greater than 80% (and in some cases even lower percentages) require private mortgage insurance (PMI).

Prior to the existence of mortgage insurance, individuals couldn’t typically buy a home unless they had at least a 20% down payment. Mortgage insurance benefits the mortgage lender directly by reducing the costs associated with borrower default. It also benefits consumers by lowering down payments, thereby allowing more people to achieve homeownership.

FHA insured mortgages require mortgage insurance premiums (MIP) and conventional loans with a loan-to-value greater than 80% (and in some cases even lower percentages) require private mortgage insurance (PMI).

Most of today’s mortgages calculate interest in arrears, unlike consumer loans, which calculate interest to the date of payment receipt. As an example, when borrowers pay their February mortgage payments, they’re paying the January interest. This method of calculating interest is based on a 360-day year in which each month has 30 days.

Nationwide Advantage Mortgage doesn’t sell servicing (the right to receive mortgage payments and maintain the customer relationship with the borrower) as a business practice, nor do we plan to sell servicing at any time in the foreseeable future. In very rare circumstances, we have sold an individual loan or released servicing to assist another mortgage company or an investor. However, our goal is to actively originate and purchase loans and to retain the servicing so that we can build a quality portfolio and establish long lasting relationships with our customers.

When a lender makes a mortgage loan (other than a home equity loan), the lender typically requires a first lien position. This means there can be no other outstanding liens against the property that are superior to the new mortgage. Liens can result from a variety of sources, such as home equity loans or lines of credit, child support judgments, divorce settlements, delinquent taxes and special assessments. Most realtors, mortgage companies, title companies and escrow companies will assist the seller and/or borrower in clearing title. The ultimate responsibility, however, lies with the sellers of the property who are warranting clear title to the buyers. It’s important the buyers receive clear title from the sellers so there are no future claims against their property ownership rights.