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ORGANIZE YOUR DOCUMENTS
If you are buying or refinancing a home:
- 2 years W2’s and one month of paystubs (if you are salaried).
- 2 years tax returns and a Year-To-Date Profit and Loss Statement (if you are self-employed).
- Three months of bank statements for each bank, mutual fund, and/or investment account.
- A current statement from your stock, retirement, and/or 401K statement.
- If you own rental property, please provide 2 years tax returns and current rental agreements.
- A copy of your divorce decree if applicable.
- If you are not a citizen, please provide us a copy of the front and back of your green card.
- A copy of your Homeowners Insurance Declaration Page (for refinancing)
For a home equity loan or second mortgage, we also need the following:
- A copy of the note for your first mortgage.
GET PREQUALIFIED
Know what you can afford before you jump in.
It is always a good idea to get pre-qualified or pre-approved before shopping for a home. You can get pre-qualified over the phone or via the Internet within a few minutes by providing a minimal amount of information. A pre-approval includes verification of your credit, income, assets and liabilities and although it is more rigorous, it is highly recommended by most professionals. Getting pre-approved for your loan before you start looking for a house will help you.
- Find out the maximum house you can buy, so you don’t waste time looking for property you cannot afford.
- Be in a stronger position when negotiating with sellers, which can also lead to betters terms for you.
- Close your loan quickly. It’s already approved!
SHOP YOUR LOAN
Check current rates and other loan terms.
- Think about how long you plan to keep the loan. If you plan to sell or refinance for major improvements within a few years, you may want to consider an adjustable or balloon loan. But if you want to keep the house longer, or plan only smaller cosmetic improvements, or turn the property into a rental, you should look at fixed rate loans.
- Understand the relationship between rates and points. Points are considered to be prepaid interest and are tax deductible. They are paid at closing in exchange for a lower interest rate. Each point is equal to one percent of the loan amount and can be calculated to the nearest eighth percentage.
- Compare different programs. Shopping for a loan can be difficult. There are many programs to choose from and it can be hard to choose which one is right for you. Our loan officers are here to provide you with the information you need to make a decision that’s best for you.
OBTAIN FINAL LOAN APPROVAL
If you were pre-approved, you are already most of the way there. If you were only pre-qualified, you will need to go through the verification and underwriting process. Either way, you will have a few details to take care of before the lender funds your loan and the house is yours. To help get the process completed quickly, you should be prepared to:
- Give thorough, accurate information throughout the loan process.
- Respond quickly to any requests for additional documents, especially if your loan is locked or you need to close by a certain date.
- Do not make any large purchases or apply for any new credit. It is best to wait until after the loan is closed to purchase furniture or a new car. This includes applying for the "3 month same as cash" plans.
- If you move large sums of money, be prepared to provide documents to trace the funds.
- Plan to be in town and available around the closing date. You will need to sign documents, do a walkthru, provide last minute information, so it’s best if you are local and available. If your absence absolutely cannot be prevented, be prepared with a power of attorney so someone can sign on your behalf.
CLOSE THE LOAN
When your loan documents are ready, you will need to sign them in escrow or with a notary public. Be
prepared to:
- Bring your identification to sign the documents. Your driver’s license, passport or state ID are commonly accepted at loan signing.
- Get a certified cashiers check for your funds. Most escrow companies will not allow personal checks.
- Review the documents carefully. Make sure the rate and terms are what you were promised and that your name and address are accurate. If in doubt about anything, ASK QUESTIONS! Know what you are signing before you do so.
Most loans close within 48 hours of signing the documents. On refinance and home equity loan transactions, federal law requires that you have 3 days to review the documents before your loan transaction can close.
CONGRATULATIONS!
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