Mortgage Frequently Asked Questions
What financial documentation will I need to provide?
Documentation such as your most recent pay stub, most recent W2 and federal tax returns (plus business tax returns if you’re self-employed), most recent 2 months of bank statement (all pages), proof of where your down payment will be coming from.
I supplied the items requested and I’m being asked for more information?
The documentation you provide is reviewed and it may create additional questions such as determining non-payroll deposits going into your bank accounts or explaining a change in your income, etc. These additional items being requested are required to fulfill the guidelines of the loan product you’ve chosen for financing.
Why am I being asked to write letters of explanation?
The loan application answers many questions regarding your employment and finances, there are other questions that may arise. To best ensure these are answered accurately, we will ask you to further explain items that are unclear. This may include, recent credit inquiries, gaps in employment history, derogatory credit, clarification of occupancy of the new home, etc.
Will I have the ability to upload documents securely?
Yes. We provide a secure loan portal specific to your loan application. You will have access to upload your documents and view the documents you previously uploaded. Please note that emails containing zip files will not be accepted.
How much can I expect to pay at closing?
We will provide you with a detailed Loan Estimate within three business days after your completed application. Closing costs and other settlement fees, including pre-paid interest, homeowner’s insurance, real estate taxes and HOA (if applicable) will be outlined in your Loan Estimate. Questions can be directed to your Loan Specialist
Can I use gift funds from family as down payment on my home?
Yes, many homebuyers get help from their family to make a down payment. You will be required to complete a gift letter and provide documentation to show the source of the funds from anyone contributing money to your home purchase stating you are not obligated to re-pay the gift.
Why am I being asked to source “large” deposits?
Any deposits into your bank accounts being used for down payment and/or funds needed for closing will likely need to be identified. You will need to be prepared to provide any other bank accounts the funds may have transferred from, proof of stock or liquidation accounts and any other sources of non-payroll funds originated from. You must keep in mind, providing additional accounts will many times raise the need to explain deposits into those accounts as well. The documentation for down payment and closing costs is required prior to your loan being cleared to close.
What is a “point”?
In lending terms, a point is equal to 1% of your loan amount. Paying points up front can lower your overall interest rate. Please contact your Loan Specialist to further discuss points that may be required for your loan.
Why do I need an appraisal?
The value of your home is an important aspect for loan qualification. The lender needs to verify the market value for your home and the comparable sales in the surrounding neighborhoods. Your down payment requirement is determined by the purchase price or home value, whichever is less in a purchase transaction. For a refinance transaction, your appraised value, determines the maximum amount of loan we can provide to you.
Why does my credit need to be checked prior to purchasing a home?
A credit report shows your history of making payments on time. The outstanding credit you currently carry is factored into your ability to pay for a new mortgage. Many credit reports have erroneous information posted to them. Even if you’re sure you have excellent credit, it’s wise to double-check at the beginning of your loan process. Straightening out any errors or disputed items now will avoid troublesome holdups down the road when you’re waiting for closing. You may see disputed items, in addition to errors caused by a faulty Social Security number, a name similar to yours, or a court ordered judgment you paid off that hasn’t been cleared from the public records. If such items appear, we will provide you information so that the errors can be corrected.
What are the top factors that determine if I qualify?
Stability of employment and income, proof of funds to close, possible reserves with a stable savings pattern and a timely payment of credit and responsible credit usage are all factors that are considered to determine your eligibility.
How long will it take to receive my formal conditional loan approval?
Once you formally apply for financing, the underwriting timeline is usually 3 business days. Our goal is to make sure that your loan closes within the timeline of your purchase contract when you are buying a home and within 30-45 days from the date of your application if you are refinancing. In order to ensure these timeframes are met you will need to work hand in hand with your Loan Specialist to provide all requested documentation and signed forms.
How accurate is the mortgage calculator?
The mortgage calculator gives you a very accurate look at the principal and interest payments on your loan. However, if applicable, you must remember that any taxes (such as city tax and county property tax) and insurance will also be added to your monthly payments.
Do I have the ability to save & finish the online application at a later time?
Yes, you will have the ability to “save & exit” an online pre-application. You will create an account and return to your loan application when desired. A Lending Specialist may contact you to offer assistance if you begin an application but fail to complete it in a timely manner.
Do I have the ability to apply with a co-borrower?
Yes, you will be asked if you intend to apply jointly with a co-borrower. If you indicate yes, then questions will be asked about the co-borrower’s information.
What does eConsent mean and do I have to accept?
eConsent means you agree to receive documents electronically through a secure loan portal during your loan process. You will be able to eSign, print, sign & upload documents as needed. Additionally, you may review documents online through your Loan Portal. You will have the option to consent for electronic documents at time of completing the online application or the eConsent request will be sent to you by your Lending Specialist. If you change your first, last names or email address during the loan process you will need to eConsent again with your updated information. You are not required to accept documents electronically. We do provide the option to send documents by U.S. Mail and to also meet in person.