By: Daniel Boxman of United Northern, NMLS ID# 1077102
Mortgage Application Process
Now that you have negotiated a sales price and reached an agreement with the seller of your home, it is time to apply for your mortgage.
You can first reach out to the lender that gave you the mortgage pre-approval, or any other lender if you desire. Since you now have a contract of sale and are ready to apply, it is not a problem to check out which lender can give you the lowest rates and fees.
Once you decide on the lender, you will need to gather up some more documents. The lender will need to get a copy of the contract of sale, as well as a canceled check you are using for your down payment. If you decide to pursue with a different lender than the one who pre-approved you, you will need to re-gather your income and tax information mentioned earlier and have your credit re-checked. This can also happen with your same lender if a large amount of time has passed since your pre-approval was issued. The lender will also need a copy of any applicants’ driver’s license/identification card as well as their social security card to verify identity.
Once all the appropriate documents are gathered, your mortgage application (1003) will be prepared. Your loan officer will send all of your documents and information into processing where your application will be finalized and set for disclosure. Your loan officer will send you your mortgage application and disclosures to be looked over, signed and sent back. The mortgage application and disclosures include, but are not limited to:
- Your personal information including name, social security number, address, and contact information
- Your current employer
- The type of mortgage you are applying for
- The purchase price of your home with your anticipated down payment
- Your quoted interest rate and mortgage payment (this may not necessarily be your locked in rate) including principal and interest, mortgage insurance if applicable, and your estimated taxes and insurance
- A good faith estimate of your total costs of the loan; this would include the bank origination fees, title fees, mortgage insurance if applicable, application fees and more
Please look over the application and disclosures carefully. There is a lot of information included, so it would be advised to understand what you are applying for as well as make sure the information is accurate. You should contact your loan officer with any questions or concerns you have.
Once you send back your signed disclosures, this is usually a good time to lock in your interest rate. Rates change on a daily basis, which means the rate you are quoted today may be different than the rate you qualify for next week. You want to make sure you get the best possible rate. Consult your loan officer about current rates and make a decision on when the best time to lock in would be.
Upon receiving your signed loan application and required disclosures, your loan officer will submit your file to be processed by a loan processor. During this phase of the loan application process, your file will be scrutinized to make sure they meet certain guidelines. If there is any additional information the processor needs it will be requested. The processing department will order the appraisal.