Routing # 256078446
MORTGAGE KNOWLEDGE CENTER
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MORTGAGE
The Home Loan Process: After Your Mortgage Application
What you'll learn: The steps to expect after you complete your loan application.
EXPECTED READ TIME: 6 MINUTES
February 25, 2022
Although filling out your mortgage application takes time and is a big step, it is just the beginning. You will have quite a bit of work ahead of you. So read on to discover the steps and learn how to prepare.
Documentation
Once your application is complete, you will need to supply documentation backing up your income and assets. In the meantime, your loan officer will pull all borrowers’ credit. The basic documentation you will need is:
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Government issued ID
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Bank statements from the two most recent months
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30 days most recent pay stubs
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Two years of tax returns
Ask your accountant for your taxes in PDF form to submit them.
Verification
Everything on your application will need to be verified, including your address for the last two years. If you have been renting, have a good phone number for your landlord. The same goes for your employment. Ensure you have the current phone number for your HR department or whoever verifies employment.
If you are a business owner, your loan officer will let you know what additional information you need to supply, like a profit and loss, business license, and business tax returns.
Down Payment
How much money do you need to save for a down payment? That along with your credit are the two significant determining factors for the type of loan program you will qualify for. And as you move along the loan process, make sure to retain all of your down payment funds. Do not spend it on anything else.
Loan Program
Your down payment and borrower credit scores will determine which mortgage loan you could qualify for. Here are the basics requirements based on loan type:
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Conventional: you will need at least 3% to 10% down, and a credit score of 620.
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FHA: you will need a down payment of 3.5% and a credit score of 620.
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VA: does not require a down payment and your score should be least 620.
Guard Your Credit
Keep your credit the same (or better) as you are moving through the process. Do not apply for any new credit or run up additional debt.
Keep Your Job
Make sure you do not change jobs or careers. Talk to your loan officer first if you are considering any big changes. Otherwise, your loan could be in jeopardy.
Pre-Approval
After you have had your credit reviewed, supplied all the basic data, and demonstrated you have down payment funds, you may get a pre-approval letter you can give to your realtor. Once you have a pre-approval in hand, it is time to start shopping.
Find Home
Shopping can take weeks to months. But once you have found a home, it is time to put in an offer. Along with the offer, you will need an earnest money deposit. This is part of your down payment funds and shows the seller you are a serious buyer.
Offer Accepted
After your realtor turns in your offer, there may be some negotiation back and forth. But eventually, hopefully, an offer will be accepted. Sometimes you have to put in several offers on different homes. Do not give up. It takes persistence, especially in a seller’s market.
Rate Lock
When your offer is accepted, it is time to lock in your rate. You will also have the option to buy down the rate if you would like to lower it even more. Talk to your loan officer for more information about locking and buying down.
Underwriting
Once your lender verifies all of your information, the next step is underwriting. If the underwriter has any questions or needs more documentation, make sure to respond right away to keep your file moving along. Be proactive and willing to provide what is needed.
Final Walk-Through
Before you go to sign the paperwork, you will do a final walk-through of the home with your realtor. This usually happens about 24 hours before closing. You will want to make sure everything is in the condition you expect, and that the HVAC is working. It is also an excellent time to make certain your utilities will be on when it is time to move.
Closing
Once you receive the final approval, also called “clear to close,” your loan officer and realtor will coordinate scheduling closing either at the title company or your home. You will be given directions for any additional funds you will need to provide. Follow these instructions carefully and stay in close contact with your loan officer and realtor.
Move-In
Finally, all of your hard work has paid off. It is time to move into your new home and celebrate. Being a homeowner is exciting, and you will have many years of memories, celebrations, and fun DIY projects ahead of you.
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Mortgage Products
Disclosures
1Conventional Loans
Except for holidays, rates are updated Monday through Friday at 10:15am EST. The advertised rates and points are subject to change. The information provided is based on 1.0 discount point, which equals 1.0 percent of the loan amount, and assumes the purpose of the loan is to purchase a property with a 30-year, conforming, fixed-rate loan. Loan amount of $400,000; loan-to-value ratio of 75%; credit score of 760; and DTI of 18% or less. The property is an existing single-family home and will be used as a primary residence. The advertised rates are based on certain assumptions and loan scenarios, and the rate you may receive will depend on your individual circumstances, including your credit history, loan amount, down payment, and our internal credit criteria. Other rates, points, and terms may be available. All loans are subject to credit and property approval.
Rates quoted require a loan origination fee of 1%; not to exceed $1,995. Speak to a PenFed Mortgage Loan Officer for additional details.
2FHA Loans
Except for holidays, rates are updated Monday through Friday at 10:15am EST. The advertised rates and points are subject to change. The information provided is based on 1.0 discount point, which equals 1.0 percent of the loan amount, and assumes the purpose of the loan is to purchase a property with a 30-year, conforming, fixed-rate loan. Loan amount of $400,000; loan-to-value ratio of 96.5%; credit score of 760; and DTI of 18% or less. The property is an existing single-family home and will be used as a primary residence. The advertised rates are based on certain assumptions and loan scenarios, and the rate you may receive will depend on your individual circumstances, including your credit history, loan amount, down payment, and our internal credit criteria. Other rates, points, and terms may be available. All loans are subject to credit and property approval.
Rates quoted require a loan origination fee of 1%; not to exceed $1,995. Speak to a PenFed Mortgage Loan Officer for additional details.
3VA Loans
Except for holidays, rates are updated Monday through Friday at 10:15am EST. The advertised rates and points are subject to change. The information provided is based on 1.125 discount point, which equals 1.125 percent of the loan amount, and assumes the purpose of the loan is to purchase a property with a 30-year, conforming, fixed-rate loan. Loan amount of $450,000; loan-to-value ratio of 95%; credit score of 760; and DTI of 18% or less. The property is an existing single-family home and will be used as a primary residence. The advertised rates are based on certain assumptions and loan scenarios, and the rate you may receive will depend on your individual circumstances, including your credit history, loan amount, down payment, and our internal credit criteria. Other rates, points, and terms may be available. All loans are subject to credit and property approval.
Rates quoted require a loan origination fee of $995.
4Jumbo Loans
Except for holidays, rates are updated Monday through Friday at 10:15am EST. The advertised rates and points are subject to change. The information provided is based on 0.625 discount point, which equals 0.625 percent of the loan amount, and assumes the purpose of the loan is to purchase a property with a 30-year, non-conforming, fixed-rate loan. Loan amount of $1,009,000; loan-to-value ratio of 70%; credit score of 760; and DTI of 18% or less. The property is an existing single-family home and will be used as a primary residence. The advertised rates are based on certain assumptions and loan scenarios, and the rate you may receive will depend on your individual circumstances, including your credit history, loan amount, down payment, and our internal credit criteria. Other rates, points, and terms may be available. All loans are subject to credit and property approval.
Rates quoted require a loan origination fee of 1%; not to exceed $1,995. Speak to a PenFed Mortgage Loan Officer for additional details.
Fixed Rate Advance Lock-In You may lock in an Annual Percentage Rate for Advances during the Advance Period. During your Advance Period, you may choose to have three separate Fixed Rate Advances locked in at any one time, with a maximum of two new Fixed Rate Advances per calendar year. Each Fixed Rate Advance must equal or exceed Ten Thousand Dollars ($10,000.00) and you may not request a Fixed Rate Advance that would cause the amount you owe to exceed your Credit Limit. The only term option for your Fixed Rate Advance is 240 months (“Fixed Rate Advance Term”). However, the term of your Fixed Rate Advance cannot exceed your Repayment Period.
Routing #256078446
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