STEP 1: Organize Your Documents
Save time and avoid delays by having this information available when you meet with us.
– Copy of Purchase Sales contract or Offer to Purchase and all addenda (signed by buyer and seller)
– Past 2 years’ tax returns and W-2s
– Past 2 years’ employment history
– Last 3 consecutive paycheck stubs (5 if paid weekly)
– Name, address and phone for past 2 years’ residence(s) and landlord(s). Renters should bring evidence of 12 months’ rent payments.
– Last 3 months’ statements for savings, checking, CD, money market accounts, etc.
– Recent statement on retirement accounts (IRA, 401K, 403-B, Annuity, etc.)
– Monthly payments and balances on all open accounts
– Divorce decree (if applicable)
STEP 2: Get Qualified
Find out how much you are qualified to borrow. When buying a home, you need to be pre-approved. Pre-approval sometimes requires a more rigorous process, including verification of your credit, income, assets and liabilities. It is highly recommended that you be pre-approved before you start looking for a home.
Being pre-approved will:
1) Inform you of your maximum affordable home value, and save you from previewing properties outside your price range.
2) Put you in a stronger negotiating position with the seller, because the seller will know your loan is pre-approved.
3) Help you close quickly, since your loan is pre-approved.
STEP 3: Apply For a Loan
All the research and preparation you’ve done to this point makes this step an easy one.
Complete and sign the residential loan application, Form 1003 and the attached loan info sheet, credit authorization and fair lending notice. Your loan originator may also request additional documents, such as a loan information sheet.
STEP 4: Obtain Loan Approval
Once your loan application has been received, the loan approval process starts immediately. This involves verifying your:
– Credit history
– Employment history
– Assets – including your bank accounts, stocks, mutual fund and retirement accounts
– Property value
– Based on your specific situation, additional documents or verifications may be required.
To improve your chances of getting a loan approval:
– Fill out the loan application completely.
– Respond promptly to any requests for additional documents. This is especially critical if your rate is locked or if you plan to close by a certain date.
– Anything that causes your debts to increase might have an adverse effect on your current application.
– Do not move money into your bank account unless it can be traced. If you are receiving money from friends, family or relatives, please contact us.
– Do not go out of town around the time of your closing. If you do plan to be out of town when your loan is expected to close, you may sign a power of attorney to authorize another individual to sign on your behalf.
– Notify your loan officer before applying for any other credit, including credit cards, personal loans or even with another mortgage company. Some loan programs have strict guidelines regarding your credit score. Credit inquiries may lower your credit score and may have an adverse effect on your loan approval.
STEP 5: Close the Loan
After your loan is approved, you will be required to sign the final loan documents. This will normally take place in the presence of a notary public. Be prepared to:
– Bring a cashier’s check for your down payment and closing costs if required. Personal checks are normally NOT accepted.
– Review the final loan documents. Make sure that the interest rate and the loan terms are what you were promised. Also, verify the accuracy of the name and address on the loan documents.
– Sign the loan documents. The notary will require that you have your picture ID with you. Some lenders also require seeing your Social Security card.
Your loan will normally close shortly after you have signed the loan documents. On refinances and home equity loan transactions, federal law requires that you have three days to review the documents before your loan transaction can be closed. Purchase transactions do not have a three-day recession period.