Category: Loan Process

GROUP INVESTMENTS

GROUP INVESTMENTS

You want to purchase rental homes but do not have enough money saved or enough income to afford one, so, you talk to your friend who is also thinking about investing. Can you get financing if you purchase rental homes together? Or, you are part of an investment group looking to purchase rental homes. Can the investment group get financing? Yes, you can. First, each of the investors must complete a loan application to qualify for conventional financing. For example, if you and 4 friends are looking to purchase a rental home, all 5 must complete a loan application. The...

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PAYOFF STATEMENT, MAKE SURE YOU OBTAIN ONE

Before paying off your mortgage loan make sure you obtain the payoff statement.  The lender can provide a payoff statement and the final amount to be paid to release their lien. Then you can know the principal balance, interest up to the date of closing, penalties (if any), and other charges the lender may charge to obtain the payoff, such as a processing fee; if there is a pre-payment penalty on the loan, it would show up here.

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THE LOAN ESTIMATE

The Loan Estimate (“LE”) is a document provided to you by the lender within 3 days of the application date.  The application date is the date when the following have been provided to the lender:

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THE LOAN PROCESS – WHAT IS INVOLVED

What happens to your loan application and supporting documents after they are sent into the lender? The file goes through setup first. The file is reviewed to make sure it is compliant, i.e. the loan package and disclosures were sent timely and are in order, the minimum credit documents are submitted, such as W2s, tax returns, paystubs, and bank statements. After it passes setup, the file gets in line for underwriting. The underwriter reviews the file to see if it meets investor guidelines. The investor is the one who will purchase the loan. Most loans are sold in the secondary...

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STAY AT-HOME ORDERS AND MORTGAGE LOAN CLOSING DOCUMENT SIGNING

Are you about to close on a mortgage loan but you’re under a stay at-home order? Are you wondering how you’ll sign closing documents? Do you have to be at the title/escrow company to sign the loan documents at closing? No, you do not. Many title and escrow companies provide notaries which will allow you to sign the loan documents at your office, your home, on vacation, or even in a foreign country. If you are signing in a foreign country, you will likely have to go to the U.S. Consulate to sign loan documents in front of an authorized...

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INVESTMENT PROPERTY PURCHASES AND QUALIFYING

If you are going to purchase an investment property, you want to make sure the rental income covers the mortgage payment. In addition, you should budget a cushion, i.e. rental income that more than covers your mortgage payment and gives you some profit each month. You can put the profit aside and keep it in a fund for repairs that may become necessary over time, or pocket it. When lenders qualify you, they make the same considerations. They will take the market rental income as determined by the appraiser and use that amount to offset the mortgage debt. Thus, the...

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CLOSING PROCESS

What is involved in the process? The closer you work with your loan originator, the quicker the loan will move through the process. Step One: Complete the loan application; Lenders require a fully completed application.This includes providing a 2 year residential and employment history. Lenders will email the Loan Estimate to you within 3 days of the application date. You will have to gather the supporting documents required for the loan. The application and supporting documentation is sent to the underwriter for review. Depending on the lender, it may take a day, or several days, to hear from underwriting. Step...

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