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Loan Application

Posted by  on Apr 16, 2009
 
When refinancing your mortgage, completing a loan application is the first thing that you will do. A loan application is the amount of money that you intend on borrowing from a financial institution for the purchase of your home. Subtracting the down payment from the purchase price of the home will provide you with the loan amount. You may also need to provide a variety of documentation to help your mortgage lender approve you for a home loan. The documentation will vary depending on the lender you choose, your loan program, and your personal financial situation.

The following is a list of documents generally required during the refinance application process. You may or may not need everything on our refinance checklist, but for a fast and easy loan process, have these items available when you are ready to complete your mortgage application. In order to prove you are income, you will need to show original pay stubs for the last thirty days. The copy of your homeowners insurance verifies that you have current and sufficient coverage on your home.
Copies of your W-2 forms are required for each loan applicant and help your lender verify past employment and income history. Copies of asset information include accounts holding money for closing costs, statements for savings, checking, 401K accounts, and investment records for mutual funds or stocks. A copy of title insurance helps your mortgage lender verify the taxes, names on the title and legal description of the property.

Keep in mind that the more information you have ready before you apply, the less time it will take to be approved and close your loan. Once you have decided to go with a certain lender and signed a purchase contract, it is time for an actual credit approval verifying income, liabilities and your ability to repay the loan. Most loan applicants go to their loan interview with a signed copy of purchase contract. A purchase contract for the house will specify the amount of your down payment, the price you will pay for your house, and your proposed closing date. When you go to apply for a mortgage, the lender will use all these data to calculate whether the house you want to buy can serve as collateral for money you wish to borrow.

Your ability to obtain a mortgage largely depends on the information contained in your Credit Report. Therefore, it is a good idea to get your credit report, before you apply for a mortgage, and correct errors. To ensure that your mortgage application will be processed as quickly as possible, it is important to bring all the proper information to your loan application interview.

Generally, you will complete the Uniform Residential Loan Application that is widely used in the mortgage industry, during the initial interview. Keep in mind that probably you will be required to pay an application fee, credit report fee and the appraisal fee when you submit the mortgage application.
After you apply, the lender will begin the work of verifying all the information you have provided. This loan approval process, described in the next step, can take anywhere from one to eight weeks, depending on the type of mortgage your choose and other factors.

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