Explaining the Home Loan Process Part 2: – The Application

Make sure you are familiar with the loan application before your conversation so you're ready to answer questions about your finances when working with the loan officer to fill it out. Two years of employment history is entered in this section. Effective Interest Rate Calculator. This section details your current financial health, or net worth. The sheet is used to enter any additional information such as when there is not enough space in the form or when detailed explanations are required.

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Uniform Residential Loan Application Freddie Mac Form 65 7/05 (rev.6/09) Page 1 of 5 Fannie Mae Form 7/05 (rev.6/09) This application is designed to be completed by the applicant(s) with the Lender’s assistance. The GSEs redesigned the Uniform Residential Loan Application (Form ), developed a corresponding Uniform Loan Application Dataset (ULAD), and created a . Uniform Residential Loan Application Freddie Mac Form 65 • Fannie Mae Form Efective 07/ Lender Loan No./Universal Loan Identiier. Agency Case No. Verify and complete the information on this application. If you are applying for this loan with others, each additional Borrower must provide.

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Section II: Property Information and Purpose of Loan

Therefore, the final has the income, asset, and employment information that the lender verified and used for underwriting purposes.

The loan originator or loan processor should have the primary responsibility to review the form for completeness and consistency of information. Any discrepancy in the income, employment, or asset information should be investigated and verified through independent sources. Internal audit, compliance, and risk management department would form the final layer of reviews to ensure that the form is being correctly completed. Form is a vital document for a loan file and is used to demonstrate compliance with various regulations such as Regulation C, Regulation B, and Regulation X.

Therefore, Form should be kept with the loan file for as long as the loan is outstanding. For cancelled, declined, or withdrawn loan the Form should be maintained for at least 25 months after the date when the decline notice was sent. This will meet the recordkeeping requirements of Regulation B. All Contents Copyright This website is an intellectual property of Pepco Infotech Pvt. By using this site, you agree to the Terms of Use.

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Latest Changes Aug 31, Real Estate Appraisals Mar 8, Mortgages Analyzed - Whatsapp Share. What is Fannie Mae Form ? Contents of Form The Form contains the following information: The first section contains certain instructions for the borrowers and explains who needs to complete the form.

The loan product that is applied for is entered in this section. This section contains information relating to the property that will be used as collateral for the loan.

The loan purpose and title information is also entered. Personal information of the borrower and co-borrower is entered. Section IV — Employment Information: Two years of employment history is entered in this section. Part-time, temporary, and seasonal jobs held in last two years should also be entered.

This section contains the income information for the borrower and co-borrower. The second set of information is the Combined Monthly Housing Expense information which determines the current cost of housing expense. Section VI — Assets and Liabilities: The information relating to all the assets and liabilities of the borrowers is entered here.

The section also requires detailed information of any real estate owned by the borrowers in the Scheduled of Real Estate Owned. Details of the structure of the property transaction is entered here. Declarations related to past credit, current residency status, purpose of residence, and other declarations are made. Certain sections may require the borrowers to provide detailed explanations. Section IX — Acknowledgement and Agreement: The borrowers provide acknowledgment to various disclosures and affirmations.

The section also contains additional information that the loan originator needs to enter. The sheet is used to enter any additional information such as when there is not enough space in the form or when detailed explanations are required.

Why is Form used as a standard loan application form? Fannie Mae and Freddie Mac require lenders to the use of Form for all loans that are sold to them.

Since lenders sell a large number of loans to Fannie Mae and Freddie Mac, it is much easier to implement the Form for all loans instead of having different forms for agency and non-agency loans.

Simplifies Technology Development and Implementation: Most of the loan origination software systems have support for the Form , including the ability to transmit the loan application electronically.

Building customized application form entails additional costs. This first section will ask borrowers to describe the loan program and amount for which they want to apply.

The information in this section should match what you discussed with your loan officer and you will probably need their help to make sure you complete it correctly. This section can be confusing due to the fact that most people have not even started looking for a new home when they fill out their mortgage loan applications.

As a result, this section will often be left "to be determined. If you have already found your dream home, you'll include the address and year it was built.

You will need to indicate who will own the property and hold the title, as well as the source of your down payment, such as savings, cash or help from a first-time homebuyer program. The third section is quick and easy. All you need to fill in is your name, date of birth, address, telephone number, Social Security number and marital status. If you plan on co-signing this loan with anyone else, make sure to record their personal information too. If you've lived at your current address for less than two years, you'll need to provide your former addresses from the past seven years.

Here, you will be required to provide proof of employment. This means submitting recent paycheck stubs and W-2 income tax forms from the last two years. This is necessary because lenders want to be able to verify your source of income in order to be certain you can make your mortgage payments and afford the other costs associated with maintaining your home.

If you haven't been at your current job for at least two years, you will need information on your past job and your loan officer will have you sign a Verification of Employment VOE , which will be sent to your current and former employers to confirm your employment and earnings. In this section, you will need to detail all forms of income. You'll use your gross income, which is what you make before taxes and deductions. Make sure to include information regarding bonuses, commissions, freelance or work, child support, rental property payments, and other forms of income.

In addition, you will be expected to enter your current rental or mortgage payment information under the "combined monthly housing expense" category. As part of this section of your mortgage loan application, most lenders will require you to sign IRS Form T, which allows them to request a transcript of your tax returns.

This section details your current financial health, or net worth. The two factors that need to be considered are how much you own assets and how much you owe liabilities. In order to paint a complete picture of your financial health, you will have to provide information regarding your assets, such as:. Next, you will be responsible for listing information about your liabilities. This includes any monthly debt payments resulting from:.

This section will list all of the important information associated with your new mortgage loan. It will detail the purchase price of your home, closing costs and the total expense of your mortgage loan which will take into consideration principal, interest, and fees. At this point, many of these items are estimates, as they won't be finalized until loan closing. Your lender will likely help complete this section.

The most important thing you need to remember about this section is that you should double-check all costs. Make sure the details of the transaction agree with your current understanding of the mortgage and its terms. In this section, you will be asked to answer questions about any legal problems or other issues past or present that may affect your financial standing.

For example, have you ever declared bankruptcy, gone into foreclosure or filed a lawsuit? This information, in addition to your credit report , will help your lender better assess your history and ability to successfully pay off a mortgage.

This section will also ask if you're a U. You can still obtain a mortgage if you are not a U. You've completed the majority of the application and now all that's left to do is sign. By adding your signature, you're agreeing that the information you have provided is true and accurate. In this section of the application, you will be asked to provide your ethnic origin and race. This information will be used for government statistics.

They want to be sure the United States housing finance system works fairly and meets the needs of every racial and ethnic group within the country. Before you sign your mortgage application, carefully review it to ensure it's complete and accurate.