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Lenders & Financing

Pre-Approval Program

Many buyers apply for a loan and obtain approval before they find the house they want to buy. Unless a person is going to pay cash for the home, a loan application will have to be made sooner or later.

Pre-qualification by a mortgage officer is a simple procedure by which you get an opinion as to how much you qualify for and can discover any obvious obstacles that might cause problems. It is a good idea but it is not as thorough as pre-approval.

Pre-approval entails making a complete application, ordering the credit reports, and verifications for the borrower. The mortgage company will issue a commitment subject to a specific interest rate and points and the satisfactory appraisal when a property is located.

There is usually a time limit placed on pre-approval commitments. You’ll want to be ready to look at homes and make a decision after you receive your pre-approval commitment.

There are several distinct advantages to using the pre-approval program:

You look at the “right” homes that you can afford. You won’t be disappointed by choosing a home that you may not be able to afford.

You save money dealing with a seller who is comfortable about “tying up” their home with a party who has a definite loan commitment. This is one less contingency for the seller to be concerned with.

You close more quickly because in most cases, the thing that takes the most time is getting a mortgage. The credit reports and all of the verifications take time to be mailed out and returned.

You minimize trauma of not knowing whether you qualify.


QUESTIONS TO ASK A MORTGAGE BANKER

1. Based on our situation, what looks to be the best program for us? Why?

2. What is the projected time for processing and closing a loan?

3. If Private Mortgage Insurance is required, when and how does it go away?

4. About your rates - terms - fees….are they all negotiable?

5. What standard underwriting guidelines do you follow?
Are there any special underwriting guidelines?

6. What is your most popular loan program? Why?

7. Who services your loans?

8. Six months to a year from now, what will make this loan look good/bad to most borrowers?

9. What are your standard and special fees?

10. What, if any, escrow requirements exist?

11. What if rates go down during the “lock-in” period?

12. Who is our contact person after application for progress reports?

13. What, if anything, do you need from us to get our loan approved?

14. Do you have any concerns about our ability to get a quick loan approval?

Items Needed for a Credit Application

Employment

• Addresses for two full years
• Gross monthly income
• W-2’s if available
• Proof of retirement, disability or Social Security
• Proof of income from rentals, investments, etc.
• Proof of child support or alimony paid/received
• Year-to-date pay stub
• If self-employed:  Two years 1040 Tax Returns and Current year profit and loss statement

Creditors

• Each creditor’s name, address and type of account
• Account numbers
• Monthly payments and approximate balances
• Amounts of child care expenses

Banking

• Names and addresses of savings institutions
• Account numbers for all accounts
• Type of accounts and present balances

Miscellaneous

• List of assets in stocks, bonds and property
• Life insurance cash value (documented if used as cash down payment)
• If applicant is selling a home, a copy of sales contracts
• Social Security numbers for all parties
• Veterans – Certificate of Eligibility and DD-214
• Cash or check to pay for application fee

REALTORS

• Copy of purchase agreement
• Copy of listing on property
• Instructions on how appraiser is to gain entrance

Barry Stollings - 304-757-5988 Ext. 227


 

Carroll Casto – 304-586-2300



Barbara Rucker – 304-720-4703

Paul Jean - 304-353-1143

©2005 Lila Ramkey