Click on the tabs below to know the Mortgage Basics
Like any type of loan, the amount you have available up front can play a major role in the loan you may qualify for, plus the amount you'll need to pay off. Down payments typically range from 3 to 20 percent of the sales price for property.
Thankfully, there are a number of smart ways to procure your down payment:
Alternative methods:
Congratulations! You've made it this far through the mortgage process, which means you've been proven to have exemplary credit, and that lenders are eager to loan you the funds needed to purchase your new home.
But sit tight and be patient. There's still a 45- to 60-day closing process - a time to hold off on major purchases or lifestyle changes that could adversely impact your finances, your credit, or the interest rate approved for your new mortgage.
Don't apply for a new credit card or line of credit; it can convey to credit bureaus and your lender that you're over-reliant on borrowing money.
Don't worry - these suggestions are only temporary. Significant spending and banking behavior requires that we "follow the paper trail" and may result in you having to submit more or updated bank and/or account statements. Waiting until the close of your mortgage process means facilitating the move into your new home more quickly and seamlessly.
Any information you provide us through our website is 100-percent secure and private. We don't share client info with anyone, except with your explicit permission. We ask because providing your information to mortgage lenders can help your chances of being approved for a home loan with the lowest interest rate possible. In turn, those mortgage lenders are bound by federal law to keep your information secure, as well.
What kind of information will we need in your mortgage application?
DOCUMENTATION
In general, the documentation you will need includes:
Check for application fee
PROPERTY INFORMATION
If you already have a contract on a house:
Purchase Agreement
Copy of legal description 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 & ASSETS
Pay stubs for the last 30 days.
Names and addresses of each employer for the last 2 years.
W-2s for the last 2 years.
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 for 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 prepared by an accountant.
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.
DEBTS
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.
MISCELLANEOUS
Photo ID and proof of Social Security number.
Residence addresses for the past two years.
If applicable, a copy of your divorce decree.
If you are not a citizen, a copy of the front and back of your green card.
Our job isn't just to find you the best home loan that suits your financial needs, but to educate our customers on answering their questions about specific mortgage products, issues or current trends. From the basics on interest rates, down payments and insurance, to sellers' concessions and details on new housing legislation, we've included here some answers to your most frequently asked questions.
We're happy to answer more mortgage-related questions you may have. Feel free to email us by clicking on the "Email" link located at the bottom of the page.
HOME LOAN BASICS
Make no mistake - there's a lot involved in getting a mortgage loan. You wouldn't be here on our website if you could fill out a one-page application and get funded the same day. That's why we're here to help simplify the four-step mortgage process and place you closer to obtaining your best home loan, so you can concentrate on what's important: saving money, moving into your new home, and building equity and credit.
The first question borrowers should ask themselves is: "How much of a monthly payment can I afford?" Take into account your credit score, credit history, income, debt and long-term goals. Then, use our mortgage calculator to estimate how a mortgage can affordably fit into your budget. Our loan officers can help you get you a good idea of the terms and loan programs you can expect to benefit most from.
Just like budgeting assesses how much you can afford to borrow, pre-qualification estimates how much money a lender may offer you - and shows sellers that you have the financial backing to secure a mortgage. To aid you in the pre-qualification process, we'll ask you to supply us information on your employment, assets, residence history, and your credit score. After review, we'll issue you a pre-qualification letter. Handle it with care - to a home seller, it's like a suitcase full of cash!
After pre-qualification, your real estate agent uses your letter to make the best offer on the home of your choice.
Applying is easy and convenient, in person at one of our walk-in branches, or online. Once your agent has made an offer - and you've been accepted - we call for an appraisal of your home-to-be.
The last step of the mortgage process, your attorney and the seller's work with an escrow/title company to handle the funding of your new loan after you've been approved. Our role is coordinating with the escrow company to ensure that the final lending stages - from paperwork to other essentials - are in order for you to sign at closing, paving the way for the next step: moving in to your new home.
WHICH LOAN IS RIGHT FOR YOU?
It's important to know all of your loan options. The table below shows the different loan options and their pros and cons.
Please contact us with any questions. This is a quick guide on your loan option, however, we can answer any specific questions you may have. An informed mind makes the best decision. We're here to help.
MORTGAGE OPTIONS
Mortgage Options based on the number of years you plan to stay in your home
MORTGAGE PROGRAMS
Fixed Rate Mortgages
Pros
Cons
Adjustable Rate Mortgages
Pros
Cons
Balloon Mortgages
Pros
Cons
First Time Buyers
Pros
Cons
Stated Income Programs
Pros
Cons
No Point, No Fee Programs
Pros
Cons
Imperfect Credit Programs
Pros
Cons
Home Equity Line Of Credit
Pros
Cons
Home Equity Fixed Loan
Pros
Cons
Pre-Qualification
Pre-qualification occurs before the loan process formally begins. The lender gathers financial information from the borrowers and makes a conditional determination about their qualifications for a loan. To start the prequalification process, click here.
Application
The application is the beginning of the formal loan process. The applicant completes a mortgage application with the Mortgage Professional and supplies all of the required information and documentation for processing. Various down payments and "closing costs" are discussed at this time and the borrower will receive a Good Faith Estimate (GFE) and a Truth-In-Lending statement (TIL) that itemize the rates, loan fees, and associated costs for obtaining the loan. To contact Lanny Clark who can help you through the process, click here.
Processing
The lender reviews the documentation and provides a loan package for the loan underwriter.
Underwriting
An underwriter determines whether the information provided is acceptable to offer the applicant a loan. If more information is needed, the applicant is contacted to supply it.
Mortgage Insurance
For a conventional loan, mortgage insurance is required when the down payment is less than 20% of the loan amount. FHA and VA loans also require mortgage insurance or similar protections.
Pre-Closing
During this period, title insurance is ordered, all approval contingencies are satisfied, and a closing date is scheduled for the loan.
Closing
At the closing, the lender "funds" the loan with a cashier's check, draft or wire to the selling party in exchange for the title to the property. This is the point at which the borrower has completed the loan process and the transaction is "closed."
Your credit score counts
Your credit score goes a long way in determining what type of mortgage interest rate you're likely to obtain, or, if you're approved for a home loan. All three credit bureaus - Experian, Equifax and TransUnion - use a slightly different scoring system, but the FICO score is the most universally recognized.
Your FICO score may range anywhere from the lowest, 300, to the highest, 850, and takes into account many factors:
Higher scores indicate to lenders that you're a better credit risk, which may qualify you for a better mortgage rate. Often, home buyers find their scores ranging between 600 and 850.
How can you boost your credit score over time? Keep a revolving line of credit, pay off loans, credit card bills and other debts on time (and in full), and minimize the amount of "hard" checks to your credit history. By law, you're entitled to your current credit score through each of the credit bureau's websites.
