Frustrated By The Loan Process?
Today, many people are frustrated with the loan process and I have many potential first home buyers complaining about the length of time it takes and amount documentation required to get an approval on their loan.
First of all, you must start the loan process as early as possible if you think you have issues such as a marginal credit history and scores and be prepared to provide a lot of information and documents as well as many letters of explanation for such items as credit late pays and inquiries, job changes and gaps in employment, large bank deposits, etc. Too many home buyers are starting the loan process while they are house hunting and some are applying for a loan AFTER finding a home which is a huge mistake.
You need to contact a loan professional to go over your particular financial situation and get pre-approved not pre-qualified. A pre-qualification is simply a loan officer running your credit and looking at your pay stubs and W2 forms and making a determination that you SHOULD be able to get approved for a loan. You should know that most sellers will accept a prequalification letter but you are NOT pre-approved for a loan. We have a formal Pre-Approval Program which we complete a full mortgage application, collect all necessary documentation and information, and submit your loan file to a “LIVE” underwriter for pre-approval. If your loan is pre-approved, we will issue you a pre-approval letter and once you find a property then we will only need to order an appraisal and update your application for such items as most current pay stub, bank statement, etc. and possibly credit report which are usually good for approximately 90 days.
Issues can arise due to changes in your situation such as job changes and lower credit scores on updated credit report. I tell buyers try not to change their situation when they are in the middle of buying a home. Don’t get a new job with a different pay structure or go out and buy a car or other items which may affect your credit scores and total monthly debt payments. There are exceptions to the rule. For example, if you are going to get a new job with a higher salary/hourly pay in the same field then this will help your situation but please run it by your loan officer before you start creating potential problems which could prevent you from closing on your new home.
Finally, I would like to stress that you should cooperate with ALL your loan officer requests for documentation for the loan because you want to give yourself the greatest chance of obtaining a loan approval when your loan is submitted to underwriting. I know the loan process can be frustrating to somebody who has never owned a home but you can avoid big headaches and become a happy homeowner if you educate yourself and get pre-approved early in the process. Please fill out fast track pre-approval form to start the pre-approval process now.