The key documents and information needed for written loan application:
Most recent pay stubs to cover 30 consecutive days.
W2s and 1099s from the past three years.
Tax returns from the past three years.
Bank accounts, CD account, Money Market, Retirement “paper” statements for 2 months (ALL PAGES of each statement are required). Provide evidence of the source of funds for any Non-Payroll deposits or funds transfers.
Name of current landlord and contact information for past two years (if renting).
Employer names and addresses for the past two years
Key questions to answer during the pre-qualification:
Do you have any un-reimbursed business expenses (expenses you write off on your tax returns)?
Do you or your spouse have any side businesses where you show a negative income (loss)?
How are you paid (hourly, weekly, salary, commission, over-time) (1009 or W2)?
All derogatory credit and credit inquiries will need to be explained.
Do you have any child support or alimony obligations?
It's a great time to buy a house! Call me and I will help you get from pre-qualified to the closing table.
Sunday, May 30, 2010
Friday, May 28, 2010
Top 10 Things NOT To Do When Buying a Home
1. Financing any type of out of the ordinary purchase. In fact, once you apply for your loan do NOT let anybody run your credit until AFTER closing. Your mortgage lender will re-pull credit before closing!
2. Changing Jobs. You must be on your current job long enough to show 30 days worth of pay history to get a loan in today's market.
3. Opening or closing old credit accounts. Similar to number 1, don't open new credit. But don't close anything either unless it is at the direction of the underwriter.
4. Moving funds between accounts or major withdrawals or deposits--all asset accounts and funds in those accounts must be verified.
5. Take your time gathering loan documents. Lending has gotten very restrictive so get your ducks in a row and submit all the paperwork your loan officer requests as quickly as possible.
6. Give incorrect information. Make sure the information you provide is accurate, list all your previous residences, jobs, landlords, etc.
7. Depositing gifts without consulting your loan officer. Or worse yet, CASH. Non-payroll deposits must be properly sourced.
8. Waiting until the last minute to convert stocks or mutual funds into liquid funds. Funds for closing will need to be documented in advance of closing.
9. Waiting until the last minute to deposit gift funds. Consult your loan officer, complete the steps he/she asks you to complete and get the funds into your account and ready for closing.
10. Waiting until the last minute to shop for home owner's insurance.
Rates are low, prices are down, call me to get pre-qualified and go buy a house!
2. Changing Jobs. You must be on your current job long enough to show 30 days worth of pay history to get a loan in today's market.
3. Opening or closing old credit accounts. Similar to number 1, don't open new credit. But don't close anything either unless it is at the direction of the underwriter.
4. Moving funds between accounts or major withdrawals or deposits--all asset accounts and funds in those accounts must be verified.
5. Take your time gathering loan documents. Lending has gotten very restrictive so get your ducks in a row and submit all the paperwork your loan officer requests as quickly as possible.
6. Give incorrect information. Make sure the information you provide is accurate, list all your previous residences, jobs, landlords, etc.
7. Depositing gifts without consulting your loan officer. Or worse yet, CASH. Non-payroll deposits must be properly sourced.
8. Waiting until the last minute to convert stocks or mutual funds into liquid funds. Funds for closing will need to be documented in advance of closing.
9. Waiting until the last minute to deposit gift funds. Consult your loan officer, complete the steps he/she asks you to complete and get the funds into your account and ready for closing.
10. Waiting until the last minute to shop for home owner's insurance.
Rates are low, prices are down, call me to get pre-qualified and go buy a house!
Two things I won't predict again
At sales meeting presentations over the past few months I have predicted two things and been wrong both times.
1. I said rates would go up. Well, they went down. And since I'm resolving not to predict them again I will just say that I hope they stay down.
2. I said that we may be at the end of the underwriting tightening. I thought this was a pretty safe bet since I couldn't imagine lending restrictions could get tighter. Well, I was wrong again. Underwriting has continued to get tougher.
But no worries here! My team and I successfully reached the closing table 9 times this month (all purchases). Bring on to June! Where we will be back to double digit purchase transactions!
Happy Memorial Day Weekend.
1. I said rates would go up. Well, they went down. And since I'm resolving not to predict them again I will just say that I hope they stay down.
2. I said that we may be at the end of the underwriting tightening. I thought this was a pretty safe bet since I couldn't imagine lending restrictions could get tighter. Well, I was wrong again. Underwriting has continued to get tougher.
But no worries here! My team and I successfully reached the closing table 9 times this month (all purchases). Bring on to June! Where we will be back to double digit purchase transactions!
Happy Memorial Day Weekend.
Thursday, May 20, 2010
Condo Financing
As many of you know, financing for a condo purchase can be challenging in the aftermath of the financial crisis. Lenders have always reviewed the condo association status before providing loan approval but the burden of project approval and resulting liability of potential inadequate approvals have shifted to the lender. So the process has become more difficult and time consuming. Here are some issues to be aware of:
1. FHA changed the approval requirements back in February. In the past, lenders checked FHA's web site for approval. If it showed the condo as "approved," we were good to go. If it was not "approved" we submitted a spot approval request and hoped the underwriter would approve it. There are NO more spot approvals.
To make matters more confusing, FHA has gone back and forth regarding the approval status of condo associations on the website. The most current information out of FHA's regional center in Atlanta is that if a condo association was previously approved prior to the February change, then the approval will expire on 12/7/10. Lenders may want to recertify that the investor concentration in the community is still below the maximum percentage before granting approval. Associations that were not approved or have not been recertified will require new certification and approval; a process which will take at least 60 days to complete. If the condo has already gone through the new approval process then a different expiration date will appear. But it is up to the each borrower's lender to again certify that the community meets FHA requirements. And that process can be just as lengthy.
Fun stuff, eh?
2. Conventional loans require the condo project to be approved through a project management review system. The process is not as time consuming but much of the same information will be reviewed for approval.
3. VA loans haven't changed the requirements. Check for approval status using the following link: http://condopudbuilder.vba.va.gov/2.2/frames.html
Either way it is clear that the lender and real estate professional will need to work together in an effort to expedite condo association approvals. Here is a list of some of the items that we will be gathering:
1. Completed FHA Condo Questionnaire.
2. Copy of the recorded Declarations, Covenants, & Restrictions.
3. Copy of the By-Laws.
4. Copy of the Articles of Incorporation.
5. Copy of the master insurance policy.
6. Copy of current and previous year's budget outlining income, expenses, and reserve amounts.
7. Copy of current reserve plan and balance sheet showing reserve balances.
8. Copy of the preliminary title report.
9. Appraisal.
10. Copy of Recorded Plat.
11. Flood Certification and/or copy of FEMA map for location.
Issues to be aware of: investor concentration, percentage of FHA loans in the community, any future additions or special assessments, pending legal actions, single entity ownership, adequate reserves.
Please contact me directly if I can help you with your real estate or mortgage related need. Thank you!
1. FHA changed the approval requirements back in February. In the past, lenders checked FHA's web site for approval. If it showed the condo as "approved," we were good to go. If it was not "approved" we submitted a spot approval request and hoped the underwriter would approve it. There are NO more spot approvals.
To make matters more confusing, FHA has gone back and forth regarding the approval status of condo associations on the website. The most current information out of FHA's regional center in Atlanta is that if a condo association was previously approved prior to the February change, then the approval will expire on 12/7/10. Lenders may want to recertify that the investor concentration in the community is still below the maximum percentage before granting approval. Associations that were not approved or have not been recertified will require new certification and approval; a process which will take at least 60 days to complete. If the condo has already gone through the new approval process then a different expiration date will appear. But it is up to the each borrower's lender to again certify that the community meets FHA requirements. And that process can be just as lengthy.
Fun stuff, eh?
2. Conventional loans require the condo project to be approved through a project management review system. The process is not as time consuming but much of the same information will be reviewed for approval.
3. VA loans haven't changed the requirements. Check for approval status using the following link: http://condopudbuilder.vba.va.gov/2.2/frames.html
Either way it is clear that the lender and real estate professional will need to work together in an effort to expedite condo association approvals. Here is a list of some of the items that we will be gathering:
1. Completed FHA Condo Questionnaire.
2. Copy of the recorded Declarations, Covenants, & Restrictions.
3. Copy of the By-Laws.
4. Copy of the Articles of Incorporation.
5. Copy of the master insurance policy.
6. Copy of current and previous year's budget outlining income, expenses, and reserve amounts.
7. Copy of current reserve plan and balance sheet showing reserve balances.
8. Copy of the preliminary title report.
9. Appraisal.
10. Copy of Recorded Plat.
11. Flood Certification and/or copy of FEMA map for location.
Issues to be aware of: investor concentration, percentage of FHA loans in the community, any future additions or special assessments, pending legal actions, single entity ownership, adequate reserves.
Please contact me directly if I can help you with your real estate or mortgage related need. Thank you!
Subscribe to:
Posts (Atom)