What You Need to Provide
Before your loan application can be underwritten, you will need to supply Greg Phillips with certain personal documentation. This may include:
-
W-2 Forms: These allow the underwriter to scrutinize your income and job history, which will directly affect your buying power and help reveal how great a risk you might be to the lender.
-
Profit-and-Loss Statements (for the past two years): If you’re self-employed, this helps substantiate your income. If your gross income appears low, remember your business expenses are often "written back" in tax deductions. Lenders usually require profit-and-loss statements, at least for the current year (year-to-date).
-
Pay Stubs: These will help confirm current your income level and verify your employment. Upon closing, most lenders will reconfirm your employment, especially if a substantial amount of time has passed since the loan was underwritten.
-
Bank Statements (two months worth): Statements for your checking, savings and other accounts indicate your resources. Underwriters generally hope to establish that the average amount required for a down payment has been maintained over time, not recently obtained.
-
Other Assets: These include the value of bonds, stocks, life insurance, retirement funds, jewelry, automobiles, etc.
-
Investment Statements: Include these statements for stocks, bonds and other investments.
-
Tax Returns (two years' worth): As a borrower, these returns provide a wealth of financial information. Underwriters look for red flags that could reveal an unforeseen debt in the case of an audit.
-
Liabilities: These include creditor names and outstanding balances for all debts including notes payable, 401(k) loans, life insurance loans, stock pledges and alimony.
-
Telephone Numbers and Addresses of Your Workplace: These allow the lender to verify your income.
-
Real Estate Owned: This includes property address, market value, outstanding liens, rental income, mortgage payments, taxes, and insurance and maintenance dues.
Property Information
You'll also need to provide information about the property you plan to buy. This includes:
-
Purchase Contract
-
Planned Unit Development (PUD), Condominium or Co-Op
◦Name of development or project
◦Phone number of the homeowner's association (if available)
-
New Construction:
◦Year the land or lot was acquired
◦Original cost of land/lot
◦Amount of liens
◦Estimated cost of construction
What Goes On At Our End
After you submit the property information for approval, we'll order your title and escrow settlement. If you cancel the loan after title work has been ordered, you may be responsible for preliminary title fees charged by the title company.
Next, a qualified appraiser will look over the property and submit a report to us. This lets us determine if the home is worth enough to support your loan. A final underwriting will take place that involves analyzing the appraisal report and your ability to repay the loan to determine our risk as a lender.
Once your loan has been pre-approved, the next step is to decide whether you will lock your rate with us. Locking in your rate ensures that your interest rate won't increase before you close your loan. Rate lock options include 30, 45, or 60 days.
However, timing is everything, and locking may not be the right choice for you. It’s best to consult with Greg Phillips.
|