Anatomy of a Mortgage

We understand that for many people, buying a home may be the biggest financial investment you make in your lifetime. And that all the jargon and terminology associated with mortgages can be a little intimidating. So we take the time to explain the entire process to you as we go, so you can feel comfortable as we fill out forms and sign papers. Here are the basic steps we go through, so you know what to expect:

1.   We interview you to fill out the necessary financial forms. Instead of just handing you a form, and telling you to go fill it out, we go through the forms with you. We can either do this over the phone or in our office. In some cases, we have even gone to someone's place of business or home to go through the forms.

Here is a list of the information you need for a Mortgage Application:

• For employed, two years of W2's, and most recent pay check stub.
• For self-employed, two years tax returns (include corporate returns/K1s or Schedule C).
• Residence address for the past two years.
• Names and addresses of each employer for the past two years.
• Gross monthly salary.
• Last three months' bank statements for all checking and savings accounts.
• Quarterly statements for stocks, bonds, and retirement accounts.
• Addresses of other real estate owned.
• Loan information on all real estate owned.

2.   After we have the basic information, we talk about your goals. For example, everyone has a different comfort level when it comes to a mortgage payment amount. (You may be living with that payment for years, so it's good to think about these things up front!) How long will you be living in the house? On a refinance, do you want cash for other purposes? Answers to questions like these help us find the best loan options for your situation.

3.   Next, we talk to you about the pros and cons of each loan product option. We explain any limitations that may exist based on your financial situation, so you can make an educated decision, based on knowing your alternatives.

4.   After you select a loan product, the file goes to processing in our office. The loan processor takes the information and verifies the information you provided, such as your assets, employment, and credit history. At this point, we also order a title search and property appraisal.

5.   Next, the file goes to underwriting at the lender that has the selected product. They give final approval, and we order the documents for signing.

6.   You go to the closing and sign everything! Because you've discussed the numbers and seen many of the forms before, there shouldn't be any surprises at closing. If you are refinancing, you have a three-day right of rescission, so the loan funds four days after you sign. Most purchases fund the next day.