First time or repeat, the requirements for applying for a mortgage is constantly in the state of change. Take the time to be prepared before you meet with your mortgage banker or broker, otherwise you'll get into what I call the "document chase". This chase can be time consuming and frustrating for home buyers. Request your banker or broker to email or fax you a complete list of all the documents required to complete the application process.
Home buyers can be proactive when applying for a mortgage by following these simple tips by Mark Nash author of four books including his latest 1001 Tips for Buying and Selling a Home and as a regular columnist for RealtyTimes.com.
-Don't be alarmed or offended when asked to sign an Authorization to Release Financial Information Form. The mortgage lender will need this form to obtain your credit report, bank accounts, employment records, mortgage history and other loans and securities.
-If you are self-employed you might also be requested to sign a Tax Information Authorization form which allows the lender to request a copy of your tax returns.
-Prepare a list of your credit cards you have by type, interest rate balance due, available credit limit, and minimum monthly payments.
-Bring payroll stubs from last six months.
-Locate tax returns from previous two years.
-List your assets such as IRA accounts, securities, bank accounts, personal property such as jewelry and furniture. If you own other real estate bring addresses and fair market value information.
-Bring copies of divorce decrees, bankruptcy discharges, student loan documents, alimony and child support obligations.
-Create lists of employment and residences from the last two years. Mortgage providers want to see stability in both these areas.
-If you have an accepted offer to purchase a property, bring a copy of the contract and copies of any earnest money checks. Have available information of other parties and real estate agents connected with the contract.
-Do not deliberately falsify information on your loan application. All information will be verified through the trimerge credit report, and verification of employment and bank accounts.
-If your lender requires an application, credit check and an appraisal fee, bring these with you to the application meeting. They might not start processing your loan without them. Do not give the loan officer any money for a credit check or other fee until you are sure you want to work with this person.
-Do not give originals to mortgage lenders. Make photo copies and submit these.
-You are only required to list enough assets to show that you can qualify to borrow enough money to purchase the home you are seeking.
-Pull your own credit report before meeting with a lender. What the scores say to a mortgage lender: 800-850=Excellent, 700-800=Great, 650-700=Okay, 600-650=Marginal, 400-600=Not good, Under 400=Help!
-The short story on how a credit score is determined. Payment history=35%, Amounts owed=30%, Length of credit history=15%, New credit=10%, Type of credit=10%.
Mark Nash's fourth real estate book, "1001 Tips for Buying and Selling a Home" (2005), and working as a real estate broker in Chicago are the foundation for his consumer-centric real estate perspective which has been featured on ABC-TV, Associated Press,CBS The Early Show, Bloomberg TV, Bottom Line Magazine.CNN-TV, Chicago Sun Times & Tribune, Fidelity Investor’s Weekly, MarketWatch, HGTVpro.com, MSNBC.com, Smart Money Magazine,The New York Times, Realty Times, Universal Press Syndicate and USA Today.
Mark is regular columnist for RealtyTimes.com, a contributing writer to BrokerAgentNews.com, PrincipalBroker.com and Realtor Magazine Online. His concise tip articles are syndicated on many real estate blogs including L..A.'s Best Real Estate Web log. He is a member of the National Association of Real Estate Editors, National Association of Realtors(R) and frequently speaks on residential real estate issues and trends through ExecutiveSpeakers.com.
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