Obtaining a Mortgage Loan Under the New Rules…
You’ve probably heard about the new lending rules, and you’ve probably heard that it’s going to be more difficult to get a mortgage loan. To hear some people tell it, no one will be able to buy a home.
That’s not so. While it’s true that the easy loans of ten years ago are no longer available, those who can afford to buy a home can still get a loan.
With the exception of the debt to income ratio, which has dropped to 43% for conventional loans, the new rules are actually a return to the old rules. Today, in order to get that loan, your income, assets, and expenses must be documented, just like they did back in the 80’s. You also have to have a good credit rating – indicating that you do pay your bills. LoansSOS grants you a possibility to obtain a loan even with a low credit score.
The other change comes from the real estate industry. Because they know that not everyone can get a loan these days, sellers and REALTORS® want assurance that the buyer can actually close on the purchase before they’ll take a property off the market.
As a result, smart listing agents are asking buyers’ agents to submit a loan pre-approval letter along with offers. Visit https://susanmacarz.com/ to learn the latest updates on the issue.
Note that pre-approval is far different from pre-qualification. Pre-qualification is done based on conversation without any documentation. It might give a buyer a general idea of how much they can spend on a home, but it gives no assurance that the loan will be issued, so carries no weight with a seller.
Pre-approval is also good for the buyer. Once you’re pre-approved, you know how much you can spend on your house. You know if you need to look at homes that meet certain requirements, and you know how many dollars you’ll need at closing.
So how do you become pre-approved? The same way you apply for a loan. You bring in documentation of your income, assets, and expenses. Here at Homewood Mortgage we verify all the information you provide, get a copy of your credit report, and then use the same Freddie / Fannie underwriting engines that are used by underwriters to get an approval.
Once we’ve issued a pre-approval letter, the only reason you won’t get a loan is that something has changed. (You’ve quit your job, bought a new car, etc.)
What information do you need to provide?
Information about your obligations:
Your car loans, school loans, child support payments, credit card accounts, payments on other real estate you own, etc.
W-2 EMPLOYEES CONVENTIONAL & FHA PURCHASE LOANS:
– Last 2 years W-2 & Last 2 years tax returns all pages.
– Paycheck stubs for the last 30 days
– Bank Statements for the last 2 months on all accounts (No Web Screen Shots ) We will accept the actual bank statements that your bank posts on the web.
– Current Statements on Investment Accounts, 401k, etc.
– Landlord Information (Name, Address, & Numbers for last 2 years)
– Employment Information (Name, Address, & Numbers for last 2 years)
– Copy of Driver’s License
IF YOU’RE SELF EMPLOYED… We also need
– Last 3 months Bank statements (Personal & Business)
– Current Profit & Loss statement
ADDITIONAL INFORMATION NEEDED FOR REFINANCES ONLY
– Copy of NOTE, will be in your original closing packet from Title Company.
– Copy of Deed of Trust, will be in your original closing packet from the title company.
– Copy of survey if not over 10 years old.
– Copy of Mortgage coupon showing loan number so we can order payoff.
– Name and Number of whom you would be using for Home Owners Insurance.
As you can see, none of this information will bar someone from obtaining a loan if they have the ability to repay. The only troubling aspect of the new rules is the lowered debt to income ratio. But even that 43% limit has exceptions.
So call Mike Clover Group at (800)223-7409. We’ll talk about your situation and examine the possibilities.
Mike Clover
Mortgage Banker
Homewood Mortgage,LLC
O: 469.621.8484
C: 469.438.5587
F: 972.767.4370
18170 Dallas Parkway
Ste. 304
Dallas, TX 75287
NMLS# 234770
