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An Overview of the Loan Process

Organize Your Documents

A properly documented loan application makes your loan process go smoothly. The more information we have, the more we can assure you are receiving the best possible loan program for your needs. This checklist will help you gather your paperwork.

  1. Complete the application with as much information as possible. If you are unsure of how to answer a question or field, don't worry. We can review any missing information together after I receive it. Page 5 of the application is a continuation page in case you need additional space for your assets or liabilities. If you make a mistake while filling out the application cross it out, and make a change. Do NOT use whiteout.
  2. If you are salaried: provide W-2's for the previous two years and one month of paystubs. If you are self-employed, provide tax returns for the previous two years, including all schedules, and a YTD profit and loss statement. (Note: If you cannot make copies of the documents, I will make copies for you and return the originals.) 
  3. If you own rental property, provide recent rental agreements and tax returns for the previous two years, including all schedules.
  4. Provide bank statements for the most recent three months, and recent statements for stock, mutual funds and IRA/401K accounts. Listing and documenting your liquid asset accounts allows us to know which loan program will work best.
  5. If applicable, provide a copy of your divorce decree and settlement agreement.
  6. If you have co-signed for any loans, please make a note of it on the application under "liabilities".
  7. If you are NOT a US citizen, provide a copy of your green card (front & back). If you are NOT a permanent resident provide a copy of your H-1 or L-1 visa.
  8. If any borrower has filed bankruptcy, provide the Discharge Notice, Filing and Schedule of Creditors.
  9. If you are applying for a home equity line of credit or loan (second loan), also include your first mortgage note. (This should be with your closing loan documents.)

Get Qualified

Getting qualified before you apply for a loan can help you understand how much you can borrow.

When buying a home, you may be pre-qualified or pre-approved. You can be pre-qualified over the phone or on the Internet in a few minutes. Pre-qualification is not as useful as pre-approval. Pre-approval requires a more detailed process, including verification of your credit, income, assets and liabilities. It is highly recommended that you be pre-approved before you start looking for a home.

Being pre-approved will:

  1. Inform you of your maximum affordable home value, and save you from previewing properties outside your price range.
  2. Put you in a stronger negotiating position with the seller, because the seller will know your loan is pre-approved.
  3. Help you close quickly, since your loan is pre-approved.

Shop Loan Programs and Rates

What loan program is best for your situation? Lenders offer many different loan options:

  1. Think about how long you plan to keep the loan. If you plan to sell your home in a few years, you may want to consider an adjustable rate or balloon loan. If you plan to keep your home for a longer time, you may want to consider a fixed rate loan.
  2. Understand the relationship between rates and points. Points are considered prepaid interest and may be tax deductible. Each point is equal to 1 percent of the loan. For example 1 point on a $150,000 loan is $1,500. The more points you pay, the lower your rate.
  3. Compare different loan programs. With so many programs to choose from, it may be hard for you to figure out which program is best for you. Now more than ever, you need to be sure you have a seasoned loan professional on your side. I can help you find a loan program that best fits your short- and long-term plans.

Obtain Loan Approval

Once your loan application has been received, we will start the loan approval process immediately. This involves verifying your:

To improve your chances of getting a loan approval:

Close the Loan

After your loan is approved, you will be required to sign the final loan documents. This will normally take place in the presence of a notary public. Be prepared to:

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 three days to review the documents before your loan transaction can close. Purchase transactions do not have a three day rescission period.