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HOME LOAN TOOLKIT

Stressed out about getting financing for a home purchase? You don't have to be. Being close with a lot of lending companies in Lake County has helped me learn a lot of the things that can make the process of applying for a loan much easier.

1 – Organize a list of questions about your loan program
Make sure you have a list of questions with you if you find that you do not completely grasp the pros and cons of the different programs. It is a challenge to know the characteristics of fixed and adjustable rate mortgages. I or one of my lender contacts will be able to assist you with understanding the advantages and disadvantages of both programs.

2 – Determine when you want to lock
Locking in signifies that the lender guarantees the mortgage interest rates for the loan – usually at the time the loan application is submitted. By floating the rate, you can lock the rate anytime between the loan application day and closing. Those who choose to float think that the interest rates will decline in the near future. Click here to see the outlook for the next 90 days of interest rates.

3 – Determine if you want to pay additional points to reduce your interest rate
Generally you can decide to pay additional points to lower the interest rate of your loan. Every point is 1 percent of the loan and is payable in cash at closing. Click here to use our points calculator. It will help you determine if buying points is right for you.

4 – Gather your paperwork
Acquiring a mortgage loan requires lots of paperwork, so you should spend some time getting all your documents together. Click here to get a feel for common information that goes on a loan application.

 

Loan Application Checklist

In general, the documentation you will need includes:

  • Check for application fee

Property Information (if you already have a contract on a house)

  • Purchase Agreement.
  • Copy of legal description and MLS sheet.
  • If you are selling your current home, copy of listing contract.
  • If you have sold your current home, copy of settlement statement (HUD-1).

Income & Assets

  • Pay stubs for the last 30 days.
    For the past two years:
    • Names and addresses of each employer.
    • W-2s
  • Statements for each bank, mutual fund, and/or investment account for the last three months.
  • Estimated value of personal property and furniture.

If you have made any large deposits to your accounts:

Explanation and source for deposit.

If large deposit was a gift:

Signed gift letter (lender can supply).

Copy of gift check.

Copy of deposit receipt.

If you own more than 25% of a business:

Corporate or partnership tax returns.

If self-employed:

Tax returns for the last three years (with schedules).

Year-to-Date Profit and Loss Statement prepared by an accountant.

If you own rental property:

Tax returns for the last two years and current rental agreements.

If you are retired:

Pension Award Letter.

If you receive Social Security:

Social Security Award Letter.

If you are counting child support as income:

Copy of divorce settlement.

Copy of twelve months of cancelled child support checks.

Debts

  • Names, addresses, account numbers, balances and monthly payments on all current loans.
  • Explanation of credit report anomalies, including:

Late payments, credit inquiries in the last 90 days, charge-offs, collections, judgments and/or liens.

Bankruptcy filed within last seven years (bring a copy of your bankruptcy papers).

VA Loans

  • Copy of DD Form 214, Report of Separation.

Miscellaneous

  • Photo ID and proof of Social Security number.
  • Residence addresses for the past two years.
  • If applicable, a copy of your divorce decree.
  • If you are not a citizen, a copy of the front and back of your green card.