General
Information
Answers to the most Frequently Asked
Questions
of real estate professionals!
The Loan Process |
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Organize your documents
If you are buying or refinancing a
home
- If you are salaried: provide
two years W-2 and one month of pay stubs OR if you are
self-employed: provide two years tax returns and a YTD profit and
loss statement.
- If you own rental property, please
provide rental agreements and two years tax returns.
- If you wish to speed up the approval
process, please also provide three months bank statements for each
bank, stock and mutual fund account.
- Provide recent copies of any stock
brokerage or IRA/401K accounts that you may have.
- If you are requesting a cash out
refinance please provide a letter explaining what you plan to do with
the proceeds.
- Provide a copy of divorce decree if
applicable.
- If you are NOT a US citizen, provide
us with a copy of your green card (front & back), or if you are NOT a
permanent resident provide us with your H-1 or L-1 visa.
If you are applying for a home equity
loan
- If you are salaried: provide
two years W-2 and one month of pay stubs OR if you are
self-employed: provide two years tax returns and a YTD profit and
loss statement.
- If you own rental property, please
provide rental agreements and two years tax returns.
- Please provide a copy of the note on
your first mortgage. This will normally be found in your closing loan
documents.
- Please provide a signed letter
explaining what you plan to do with the proceeds.
- Provide a copy of divorce decree if
applicable.
- If you are NOT a US citizen, provide
us with a copy of your green card (front & back), or if you are NOT a
permanent resident provide us with your H-1 or L-1 visa.
Get Qualified
Getting qualified before you apply for
a loan can help you understand how much you can borrow.
When buying a house, you may get
pre-qualified or pre-approved. You can typically get pre-qualified over
the phone or on the Internet in a few minutes. A pre-qualification is
not as beneficial as a pre-approval where you have to go through a more
rigorous process which includes verification of your credit, income,
assets and liabilities. It is highly recommended that you get
pre-approved before you start looking for a house. This will help you:
- Find out the maximum house you can
buy, so you don't waste time looking for properties you can not
afford.
- Puts you in a stronger position when
you are negotiating with the seller, because the seller knows that
your loan is already approved.
- Helps you close quickly, since your
loan is already approved.
Shop loan programs and rates
To shop for a loan you will need to:
- Think about how long you plan to
keep the loan. If you plan to sell the house in a few years you
may want to consider an adjustable or balloon loan. On the other hand,
if you plan to keep the house for a longer time, you may want to look
at fixed loans.
- Understand the relationship
between rates and points. Points are considered to be prepaid
interest and are tax deductible. Each point is equal to one percent of
the loan. So for example 1 point on a $150,000 loan is $1,500. The
more points you pay, the lower the rate you will get.
- Compare different programs.
Shopping for a loan can be difficult. With so many programs to choose
from, each of which has different rates, points and fees, it's hard to
figure out which program is best for you. That's where an experienced
loan officer can help you make a decision that's best for you.
Obtain Loan Approval
Once your loan application has been
received we will start the loan approval process 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.
- Do not make any major purchases. Do
not buy a car, furniture or another house till your loan is closed.
Anything that causes your debts to increase might have an adverse
affect on your current application.
- Do not move money into your bank
accounts unless it can be traced. If you are receiving money from
friends, family or other relatives, please contact us.
- Do not go out of town around the
closing date. 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.
Close the Loan
After your loan is approved, you will
be required to sign the final loan documents. This will normally take
place in front of a notary public. Be prepared to:
- Bring a cashiers 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 loan terms are what you were
promised. Also, verify that the name and address on the loan documents
are accurate.
- Sign the loan documents.
Your loan will normally close shortly
after you have signed the loan 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.
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