Terms and what they mean to you.
Before you receive a mortgage loan, you will need to pre-qualify
for a loan. This is an important step in house hunting! Because
if you pre-qualify for a loan before you start looking for your
new house, you will know how much you can afford. Or if your looking
to apply for a refinance, consolidate your debts, or home improvement
loan a pre-qualify will help you see the funds you can borrow and
what your new monthly payments will be
In order to pre-qualify, you will need to give personal and financial
information to your broker/lender. The broker/lender will evaluate
your income, debts, and ability to pay for determining the total
amount you can borrow. The broker/lender will be able to show you
different types of loans, qualifications and which one suits your
needs the best.
Apply for Loan
You will complete a mortgage application with the lender of choice.
This is actually the beginning of the loan process. Various fees
will be discuss at this time, along with the total amount of your
down payment. After this process you will receive a Good Faith Estimate
and Truth in Lending statement that will itemizes the rates and
associated costs for obtaining the loan.
The lender will verify your employment, income, debts and credit
report for payment histories. If there is a negative credit report,
then the lender will send a refusal letter with an explanation.
If the credit report is acceptable then there will be an appraisal,
land survey and other property issues that may need further attention.
This process will gather all the above information so that the lender
may underright your loan.
Lender underwriting usually occurs between days 21 and 30. The underwriter
is responsible for determining whether the processed information,
above, is deemed as an acceptable loan. You will be contacted at
this time, if there is any more information needed. Until you supply
the needed information, your loan application process will be held
in a state called, "Suspense".
If you're down payment is 20% or less, you will be required to purchase
mortgage insurance. The loan will be submitted to a private mortgage
guaranty insurer, who provides extra insurance to the lender in
case of default. Again, you will be contacted at this time, if there
is any more information needed. Until you supply the needed information,
your loan application process will be held in a state called, "Suspense".
Once insurance is obtained your application will be returned to
the mortgage company.
During this time the title insurance is ordered, all approval contingencies,
if any, are met, and a closing time is scheduled for the loan. Pre-Closing
occurs between days 25 and 30.
This is the point at which the borrower finishes the loan process
and actually buys the house. Closing usually occurs between days
25 and 45 of the loan. The lender provides the funds to purchase
Credit Bureaus and your credit reports
important to understand that Credit Bureaus are nothing more than
keepers of your credit account records.
keep a record of:
- who has
given you credit.
- when they
gave you credit.
- how much
credit you are given.
- how much
your current payments are.
- whether or
not you paid it back on time.
will check your credit report to verify financial history when you
want to obtain credit for:
- credit cards
- misc. loans
for a car
- home finances
or home property leases
The people who
request your credit file pay the Credit Bureaus.
Credit Bureaus own large computer systems capable of storing credit
information on everyone in the United States. However, because of
the large amounts of information, their method of storing information
is very basic and may have many errors. You should always get a
credit report before applying for any type home loan and verify
all the information is correct. If not, this will give a chance
to correct errors, before the mortgage lender views your report.
top three Credit Bureaus - click
bureaus' name to view their web site.
P.O. Box 1000
Chester, PA 19022
P.O. Box 2002
Allen, TX 75013
P.O. Box 740241
Atlanta, GA 30374