| Click on our Advertisement |
|
|
When trying to obtain a mortgage you will have to complete a loan application that provides property information and ensures that you?ve provided accurate information, consented to a credit check and agreed to the verification of your personal information.
Because of the serious obligations surrounding a mortgage application the lender may very well require additional information regarding you or the property you are trying to finance even after the application has been submitted. While loan officers and brokers will try and obtain all the information they need from the start, occasions do arise where the ultimate lender requires additional details.
Some of the more common information required, includes:
- Employment and income records
- Tax Returns for the last few years
- List of assets and other property (i.e. stocks, bonds, real estate, cars, etc.)
- List of liabilities and what you owe (i.e. credit cards, personal loans, car loans, other obligations)
- Your budget showing monthly living expenses so that you can demonstrate an ability to pay
With the lender providing funds for a property there will undoubtedly be an appraisal process where an unbiased appraiser will determine the value of the home you are interested in. This value is typically determined by analyzing the condition of the home, the surrounding area and the value of comparable homes.
When the application is submitted there will probably be some up front fees for the credit report, appraisal, and application. Ask the lender ahead of time what fees are associated with your mortgage application. Depending on the information submitted you?ll either be approved for the mortgage or be pre-qualified, at which time a team of underwriters will finalize the documents and work to formally approve the loan.
Once all of your information has been processed, your credit and employment verified, the appraisal finalized, and other documents checked, you may finally be ready to hear the good news. Know that delays are typical as there is a lot of information being shared throughout the entire mortgage process.
Eventually you will receive a good faith estimate of expected closing costs so that you know how much you?ll have to pay at settlement, including any closing costs, origination fees, mortgage insurance, insurance, etc. You?ll also receive a "Truth in Lending" disclosure statement that shows what your estimated monthly payment might be.
You will also be shown the Annual Percentage Rate (APR) which represents the total amount of finance charges you will pay through the loan. Because the APR includes fees, charges and interest, the APR is typically higher than the actual interest rate of the loan. This is normal and rarely a cause for alarm.
After the lender has approved your home loan, you?ll receive a commitment letter that sets the terms of the loan and how you are expected to perform. You will typically have to return the commitment letter with your signature to formally accept the mortgage loan and at that time, your loan will be in motion and you?ll soon be a homeowner!
At closing you?ll have a number of documents to sign and you?ll spend some time with your attorney going over the information to make sure everything is accurate. In most cases the lender will not appear at closing but either be represented by their attorney or even in absentia. When you leave closing, you?ll probably have the keys in hand and it?s time to go out and celebrate your new home!
|
