How to Simplify the Mortgage Process and Make it Easy to Obtain Financing

If you ask the average person what was the most stressful part of seeking a mortgage, most will tell you the diversity of products. The mortgage industry has come a long way from a few basic programs to an array of financing options.

There are products to accommodate most any of life’s circumstances whether you have slow credit, filed for bankruptcy, had a foreclosure, an average credit score, or struggling to make ends meet. Without the assistance of a knowledgeable mortgage professional even a seasoned homeowner or investor can become confused.

Giving all that the real estate market has gone through, and the changes from the Federal government there is a need for expert knowledge in the market. Everyday the news media announces what is happening in the mortgage industry, but these reports only give a brief summary of the topics.

In order to get a better understanding of how you would benefit from the topics it would be to your best interest to seek out the advice of a mortgage professional. The mortgage professional can give you critical insight based on your individual set of circumstances. That professional can recommend which product can help you build wealth through home ownership.

When deciding the right time to start looking for a home most people assumes that their credit profile is not up to par. Assumption without facts can possibly limit a potential home seeker to settle for a home in an area of town that could not give them the monetary return they need.

Schedule an appointment with a mortgage professional, and do a comparison to see which program offers you the best benefits. Programs are designed for specific needs, and choosing the incorrect one can cause you to not receive the rate of return you were expecting in a specific timeframe.

When meeting with the mortgage professional discuss what you are looking to accomplish. Be open and honest, and if you are not clear on a certain matter, ask for clarification. Mortgage professionals are there to provide you with informative answers to help you make a qualified decision.

The mortgage professional will need to know if you are a first time homebuyer, because this year you can take advantage of the tax credit. This feature alone can save you substantially on your taxes. Other questions may be have you previously owned a home, are you a veteran, and how many dependents do you have.

Lenders want to know if you have stability in your employment, how much are you willing to contribute toward your down payment, will you be using gift funds and how much.

In order to get an accurate picture you may be asked how long do you plan to stay in your home, are you seeking an investment property to build your portfolio, have you had any problems with your credit, and if so, what issues did you have and were the issues resolved.

Before your first meeting, the following are a list of basic documents that you should have on hand to give your mortgage professional:

• Copies of (2) most recent pay stubs for all borrowers
• Copies of (2) most recent W-2 forms for all borrowers
• Copies of 1040 Forms Corporate and Individual (Self-employed Borrowers)
• Copy of (2) most recent months bank statements for all accounts, for all borrowers
• Copy of (12) months cancelled checks or bank statement showing payments of rent
• Copy of Front & Back of cleared check for earnest money deposit (Purchase Only)
• Copy of VA Certificate (Veteran Only)
• Copy of 1st Time Homebuyer Certificate (If Applicable)
• Copy of Divorce Decree, Separation Statement for Alimony or Child Support (If Applicable)
• Copy of Bankruptcy Discharge Papers, with Itemized List showing what creditors were included in bankruptcy (If Applicable)
• Copy of Driver’s License, or State ID for all borrowers
• Copy of Social Security Card, or other identifying document, for all borrowers
• An original letter of explanation signed and dated by all borrowers detailing any credit issues. You should explain any slow or missed payments, bankruptcy, judgments, foreclosure, or discrepancies on credit report. Mention if you have disputed any inaccurate information. Letter should also explain any gaps in employment, and anything else that would raise a red flag.
• Fee for Credit Report (Purchase & Refinance)

Make sure to have on hand proof of a (2) year employment history for all borrowers. Provide the name of employer, employer’s full address, name and phone number of the Human Resource contact.

The manner in which you pay your rent is significant in obtaining a mortgage. The name, full address, and telephone number of the landlord is an important step in this process. Please make sure you give accurate information.

Have your credit information prepared to present to the mortgage professional.

• Name of Creditor
• Creditor’s full address
• Account number
• Monthly payment and balance owed on each account
• State if account is a personal loan, credit card, auto loan, mortgage, student loan, or if you are a co-signer on a loan.

When you are purchasing a home have your real estate agent provide you a copy of the purchase contract, will all addenda on the home, and a copy of the listing.

If you are considering refinancing your home, have the following documents available:

• Copy of Survey
• Copy of Insurance Declaration Page
• Name Of Insurance Agent and phone number
• Proof of Flood or any other Insurance (If Applicable)

Current homeowners who are both selling and purchasing a home simultaneously should have the following:

• Copy of contract including all addenda for present home (If Selling Property)• Copy of lease of present home (If Renting Property)

The above information will help to expedite the loan process. An underwriter may request additional documents, or information to be able to make a qualified decision to get the loan approved.

If the underwriter ask for other information be prompt to give what is needed to your mortgage professional. Mortgage lenders have what is called “turn times” when underwriters work on loan files. The turn times are different for Government, Conventional, and U.S.D.A loans.

It is to the borrowers’ advantage to submit a complete package upfront. As mentioned before, the underwriter may request additional documents. Gather this information in order to stay within the specific period.

In addition to the guidelines of your specific mortgage, the promptness and efficiency of the borrowers’ efforts produces a higher approval rate.

So gather your documents it is time to continue living “The American Dream!”