Applying for a mortgage is a daunting process, so being informed is key to make the entire process go a little easier. Still, there are many things to learn and consider, so we have created an overview that gives you immediate access to the essentials of your mortgage application. These basics should give you a solid basis to start your application, so be sure to read on and discover them!
Mortgage Type and Loan Terms
On your loan application, you will find the “type of mortgage and terms of loan” section. The information filled in this part of your application should match the mortgage and the terms you’ve discussed with the loan officer. If you have not selected your property yet, you can enter the amount of money you wish to borrow.
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Property Formation & Purpose of Loan
Those who already selected the home they want to buy need to include this information on the mortgage application, more specifically in the property information section. Information that must be included is the address and the year the property was built. The applicant must also state whether he wants to purchase the home or refinance it.
Applicant Information
Your loan application must include accurate information about yourself; this includes information about your partner as well. Information that is usually included in your mortgage application is your social security number, date of birth, marital status, contact information, former addresses and more. It is vital that this information is correct, because this is the information that will be used to obtain your credit history and current financial situation.
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Employment & Income
To ascertain your suitability for a certain mortgage amount, the application must include information about your employment history and your income. Information that should be included are the places you have worked and the duration you have worked there. It should also include your monthly expenses, recent paychecks and federal W-2 income tax forms of the past two years. The more information you can provide here, the better, because this information is used by your loan officer to determine if you could make the loan repayments required.
Assets and Liabilities
The assets and liabilities section gives loan officers an idea of your net worth, which is obtained through a comparison of how much you own (assets) and how much you owe (liabilities). Items that are considered assets include retirement funds, savings, bank accounts, cars, trucks, etc. Of course, you must also include copies of your account statements of the past two months.
Other Vital Information on Your Application
In addition to the information already described, there are other important sections on your mortgage application that should be filled in as accurately as possible; this includes transaction details, declarations, acknowledgement and agreement, and information for government monitoring purposes. Once you have completed all this information, you are eligible for pre-approval. Once the pre-approval is signed, you will get a pre-approval letter, which states that the lender will provide you with a specific amount of money for your home purchase. So, if you have such a letter, the entire process of buying a home will go a lot easier.
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