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The New York Times What are your thoughts on reverse mortgages? This review examines the pros and cons of reverse mortgages from a variety of perspectives. These are the comments that people like you have to say about us. Original post here: Love Them or Loathe Them Reverse Mortgages Have a Place Love Them or Loathe Them Reverse Mortgages Have a Place syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/love-them-or-loathe-them-reverse.html
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The New York Times Although this parental instinct may seem generous and loving, there’s another way to see it. These are the comments that people like you have to say about us. Original post here: Parents, the Children Will Be Fine. Spend Their Inheritance Now Parents, the Children Will Be Fine. Spend Their Inheritance Now syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/parents-children-will-be-fine-spend.html Mortgage closing: How much money do you need for “escrow”? One of the biggest costs you’ll encounter when closing on a home is the “escrow account.” You’re probably not too excited about contributing to this fund, especially because you have no idea what it’s for. While this may feel like an unnecessary charge, escrow is actually just a way to prepay costs associated with owning a home. Let’s dive in a little deeper. Verify your home buying eligibility with top lenders here. (Oct 21st, 2021) In this article: What is escrow, and why does it cost so much? An escrow account is established by the lender at closing with funds from the home buyer. The lender eventually uses the money to pay costs like property taxes, homeowner’s insurance, flood insurance, and more.The escrow account often must be “front-loaded” at closing, to give the lender a little cushion to make sure the money will always be there when needed.Under federal rules, a lender can collect enough escrow funds to cover your annual bills, plus two monthly payments, plus $50. Why do lenders require escrows or impounds? The idea behind an escrow fund is to protect both the borrower and the lender. Everyone knows that a home can be foreclosed if the mortgage is not paid. However, a home can also be foreclosed for other reasons, such as not paying property taxes. With an escrow account, the lender has the money in hand to pay such costs on your behalf. It’s a way of guaranteeing that you won’t be late on your property tax payments. The escrow account can also benefit you. Because once established, the account balance is maintained by regular monthly contributions from you, added to your mortgage payment. If you didn’t have an escrow account, you would likely need to pay hundreds or thousands of dollars to the county a few times per year. That’s hard to budget for. Likewise for homeowners insurance. Your insurance agent only requires a payment once per year. It can be a large sum. If you didn’t budget for it, your insurance coverage lapses and you won’t be compensated if your home is damaged or destroyed. Related How to buy a house with $0 down in 2020 How do escrow accounts work? Escrow accounts hold money collected in advance. When property taxes or insurance premiums are due, the lender pays those “for you.” Of course, the lender doesn’t actually come up with the money. They simply make the payment from funds they’ve already collected in the escrow account. Let’s say that your property requires the following annual payments. Taxes: $4,000 per yearHomeowners insurance: $1,200 per yearTotal: $5,200Monthly amount collected by the lender: $433 To maintain the escrow account, the lender will collect 1/12 of the annual bill each month. So if your principal and interest payment on the mortgage is $1,500, your total mortgage payment to the lender would be $1,933 per month. How much can lenders keep in escrow accounts? Under federal rules, a lender can collect enough escrow funds to cover your annual bills, plus two monthly payments, plus $50. In the example above, the lender could have in escrow as much as $5,200 (the expected size of the bills), plus $887 (an amount equal to two monthly escrow payments), and $50. This is a total of $6,137. Annual reconciliation of the escrow account Once a year, the lender provides an escrow account statement to you. It must also refund excess money collected. If the escrow balance is insufficient to cover your costs (perhaps your taxes or insurance premiums have increased), the lender can require you to make up any shortage. Usually, you get to choose between paying a lump sum, or making up the shortage during the next year by paying a higher monthly escrow fee. Mortgage closing and escrow If you buy a home with 20 percent or more down, the lender may waive the requirement to have an escrow account. The lender might require you to put your loan on an auto pay or impose a fee (typically 0.25 percent of the loan amount) to waive escrow. This means you’d pay your own property taxes, homeowners insurance, and other fees as they become due. So a borrower with a big down payment can avoid monthly escrow payments. However, the obligation to pay taxes and insurance remains. Many borrowers who make big down payments still want an escrow account, because it’s an easy way to budget costs and assure that basic bills are paid. Plus, the lender doesn’t charge a monthly fee or “skim off the top” to make the payments for you. One hundred percent of the money you pay into the escrow account must go toward your taxes, insurance, or other fees you would pay anyway. Risking foreclosure and other problems What happens if you don’t have an escrow account and fail to pay taxes or homeowners insurance? In the case of taxes, you can face foreclosure. The county could take your property from you. If you don’t pay for property insurance, the lender will probably purchase a replacement policy for its own protection. Force-placed insurance can be very expensive, in some cases two-to-ten times the cost of typical policies. This coverage is called “force-placed insurance,” and it’s not a good thing. Because the lender is picking the replacement insurance, it does not have an obligation to select the cheapest or best coverage. Force-placed insurance can be very expensive, in some cases two-to-ten times the cost of typical policies. How can you avoid force-placed insurance? Get an escrow account. How do I apply to buy a home? An escrow account is nothing to be afraid of. The initial cost looks daunting, but you are just paying costs ahead of time. That said, you want to keep overall upfront costs low. The best way to do that is to shop around for top lenders. Shop today’s top lenders for better rates and lower fees. (Oct 21st, 2021) Original post here: Mortgage closing: Why does my lender want so much escrow money? Mortgage closing: Why does my lender want so much escrow money? syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/mortgage-closing-why-does-my-lender.html Digital is king, except when it comes to real estate closing Mortgage lending is one of the few industries where most people still want a face-to-face interaction. Digital tools can be great for shopping around or managing your home loan. But if you’d rather handle the document signing in person, you’re not alone. More than 80% of people feel the same, according to a recent study. So, if given the option to close on a house remotely, should you? Many experts say no. With the right lender, closing on a house in-person can be a much better process than an all-digital mortgage loan. Connect with today’s recommended lenders (Oct 21st, 2021) Look for digital convenience, but a personal touch at closing Solidifi, a real estate appraisal company, recently polled home buyers about their mortgage loan preferences. Overall, there were mixed feelings about digital versus in-person lending: 81% favor closing in-person. This supports the value of having a professional and qualified closing agent at the tableBut seven in 10 prefer a more digital process at the closing table. Nearly a quarter suffered delays during the closing process; half of these delays were caused by problems with the paperwork or the filing In addition, 47% said they felt anxious about the closing process. That explains why the qualities rated most important for closing agents were “knowledgeable” (chosen by 50% of respondents) and “efficient” (40%). One of the best things you can do to ease closing fears is shop carefully for a lender. Find someone you trust and are comfortable working with, and the whole loan and closing process will be that much easier Find top mortgage lenders here (Oct 21st, 2021) Why work with an expert when closing on a house? Loren Cooke is president of Solidifi. He says there are several valuable takeaways from this report. “Consumers want a knowledgeable professional there at closing. That’s because this person can address any concerns and answer questions. And they can ensure all important details required for the closing on a house are being handled appropriately,” says Cooke. “It’s all about the customer experience. The right professional will guide customers through the process. And they will offer assistance with any questions.” “This makes the process less stressful. So does ensuring that all loan documents are signed correctly,” adds Cooke. “After all, a real estate transaction is a complex process. And almost half of our respondents indicated they felt anxious or nervous.” Closing in-person helps ensure that all loan documents are signed correctly, and can avoid delays that come from unsigned or missing documents. Lindsay Smith, chief strategy officer for Title Alliance, Ltd., says there’s another message here. “Buyers want a digitalized process, through electronic mediums. But they don’t want a digitalized closing. These are two very distinct items that most people confuse,” says Smith. Put another way, people don’t enjoy having to pore through and sign a huge paper stack of loan documents. That’s no surprise. They’d like to expedite or streamline matters. Digital tools and more efficient technology can help. But most still want one or more experts present. That means an attorney, loan officer, and/or title professional. Having an expert there can help you make better decisions “On one recent occasion, one of our notaries was assigned to a closing,” Cooke recalls. “The homeowner was undecided. And his loan officer couldn’t convince him that he was making the right decision.” The closing agent listened to them discuss the issues. The homeowner and loan officer weren’t making any headway. “That’s when the closing agent stepped in. This person shared a personal experience with another scenario. The agent explained the numbers and situation in more detail to the customer. After thinking about it a bit more, the customer signed the paperwork. And the closing went through,” says Cooke. When you can choose your own location for document signing Generally, closing takes place at the office of your lender, title company, attorney, or escrow company. One or more experts will be present at closing and provide answers to anything you don’t understand. But the truth is, closing on a house doesn’t have to take place at one of the offices mentioned. Depending on your state’s laws, the real estate closing can occur at a location convenient to you. Depending on state laws, you may be able to choose a location for real estate closing that’s convenient for you. Also, when you’re buying a home for cash without a loan, you can pick the closing spot. In this case, an attorney or mobile notary meets with you at your desired location to present the loan documents and disbursement services. This is called a “witness only” closing. “Mobile notaries can allow for a closing to be conducted at the parties’ convenience,” explains Elizabeth Whitman, attorney and managing member at Whitman Legal Solutions, LLC. “I scheduled my mortgage refinance with a mobile notary. This person came to our house in the evening. That way, neither my husband nor I had to take time off work. And we didn’t have to find childcare to attend an in-person closing.” Why an in-person real estate closing is still better But many experts don’t recommend a witness-only or remote closing. “Document signing in person provides both the buyer and seller with a more intimate experience,” says Kurt Westfield, partner at Clear Title Partners. “Professionals on hand can answer questions, especially in title offices operated by attorneys. This can be a huge source of relief. In addition, it can remove some of the anxiety associated with buying or selling your home.” Remember: A home purchase will likely be the single largest transaction in your life, Westfield notes. “So having a professional at the ready and in-person in a brick-and-mortar office can be very assuring,” says Westfield. With a remote closing, answers to the questions you ask may have to wait. Smith notes some of the common questions that might pop us at closing, like: Why are we paying these taxes now?Where did this credit come from?How do I know if my HOA dues are current? Without an agent on the scene, “answers to these queries can get delayed,” Smith cautions. That’s because they may need to go back to the person who prepared the loan documents.” Also, looking over your paperwork with a pro before signing lets you inquire about any red flags you spot. With a remote signing, you can actually miss out on a more memorable experience, too. “Real estate transactions are wrapped in emotions. These emotions, as well as the support and memories, are not captured in the same capacity when the closing is remote or digital,” adds Smith. “The atmosphere for a closing invokes a sense of celebration. It’s not uncommon to receive balloons, flowers, confetti, fresh cookies, or a celebratory toast once closing is completed at an office.” Connect with today’s recommended lenders (Oct 21st, 2021) What’s in the future for real estate closing? Smith believes that closing should always require an in-person and personal interaction. “In addition to the complexities of the transaction, the human experience and emotional reaction alone deserve a face-to-face experience,” she says. Increasingly improved technology and electronic signing options can help, though. “Using an iPad or thumbprint to sign would help modernize and digitalize the actual document signing. I’m certain these advancements are coming in the future,” says Smith. Cooke notes that people have been talking about complete digital closings for years. “Yet the industry hasn’t moved there yet. Based on our research, we agree that people want a more digital experience,” says Cooke. “But comfort and convenience for consumers don’t always equate to complete automation. People still want a human connection to walk them through a mortgage signing.” Ease your worries about closing on a house A better closing process starts with having the right lender at your side. That means you should not only compare rates and fees when shopping for a mortgage, but also customer service. Take note of the tools available and quality of communication when you’re requesting quotes. We recommend comparing at least three lenders to find the right one for you. Verify your new rate (Oct 21st, 2021) Original post here: Why closing on a house is better in person Why closing on a house is better in person syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/why-closing-on-house-is-better-in-person.html In this article: A mortgage disclosure is a five-page summary outlining all the key points about your new mortgage. Your lender is legally obliged to send you a mortgage disclosure at least three business days before you’re due to close. The following information is included in your mortgage disclosure: The type of mortgage — fixed rate or adjustable rate and the number of years it could lastHow much you’re borrowingHow much you’re going to pay — each month and overallAny escrow arrangementsYour closing costs in detailHow much you need to bring to closing This is your chance to compare the disclosure with the estimate you previously receive and to query any discrepancies. There shouldn’t be any such discrepancies that can’t be justified transparently. Indeed, this is your last chance to challenge any errors without derailing your home purchase, so review the document carefully. Buying a home: Don’t fall at the finish line At least three business days before you’re due to close, you should receive a closing disclosure. Could there be a worse time? You’re preparing to move! And your to-do list has never been longer. So the last thing you want is a five-page document to wade through. Resist the temptation to ignore it because this is your last chance to make sure the mortgage deal you’re getting is the one you’re expecting. And possibly your last chance to fix any errors and close on time. Verify your new rate (Oct 21st, 2021) What is a closing disclosure? You’re going to get a mortgage disclosure. Your lender is legally obliged to send you one at least three business days before you’re due to close. It’s a five-page summary outlining all the key points about your new mortgage. Those include: The type of mortgage — fixed rate or adjustable rate and the number of years it could lastHow much you’re borrowingHow much you’re going to pay — each month and overallAny escrow arrangementsYour closing costs in detailHow much you need to bring to closing Final figures You’ll have received some of this information before in a Loan Estimate. But, as the name implies, those were just estimates. The mortgage disclosure document shows finalized figures. This is your chance to compare the disclosure with the estimate and to query any discrepancies. There shouldn’t be any such discrepancies that can’t be justified transparently. Indeed, this is your last chance to challenge any errors without derailing your home purchase. Okay, you can simply refuse to sign on closing if you notice an error then. You’ll be delaying (if not aborting) your purchase — possibly by weeks. Identifying issues earlier, when you get your closing disclosure, can often see you avoid delays altogether. It’s easy! Even if you hate forms and legal documents, the closing disclosure is easy. It is a clear, simple, standardized form used by all lenders. And, thanks to its uncluttered layout, it gives you the maximum information with the minimum fuss. Most home buyers will be able to zoom through it in minutes rather than hours. Federal regulator the Consumer Financial Protection Bureau (CFPB) has come up with a sample form. That has annotations that explain the most important things you can check. The Mortgage Reports is sharing that sample below, courtesy of the CFPB. A page-by-page guide Page 1 The front page is arguably the most critical because it contains an overview of your mortgage. Some key points to check there include: The correctness of your name and addressThat the type of mortgage described is the one you’re expectingThat the loan amount, interest rate and monthly payments are the same as those on your most recent loan estimateAny pre-payment penalties that could kick in if you move, refinance or pay down the loan earlyWhether any escrow arrangements for certain ongoing homeownership costs are in line with your expectationsThat your closing costs and the sum required from you on closing conform to your last loan estimate Page 2 The second page breaks down closing costs. It also makes clear whether you’re buying a cheaper interest rate by paying more on closing (“points”). There are two main categories of costs: services you didn’t shop for (appraisal fee, credit report etc.) and those you did shop for (maybe a pest inspection, survey or title insurance). For the former, compare the costs on the closing disclosure with those on your loan estimate. For the ones you did shop for, make sure the sums match the amounts you agreed to pay. Page 3 This third page itemizes the sums that make up your “cash to close,” the amount you’re going to pay on closing. It also breaks down the smaller transactions (things like local property taxes and homeowners’ association fees) that are necessary to complete your purchase. If you’ve agreed to a “seller credit” (a contribution toward your closing costs that the seller agrees to make) with your vendor, make sure the amount at item L-05 matches your agreement. Page 4 Page 4 lays out more numbers and details concerning your escrow account. That includes whether you have one at all. If you don’t have one, you may (or may not) be paying an escrow-waiver fee. The cost of that will be indicated toward the bottom of the right-hand column. Meanwhile, in the left-hand column, you’ll find stuff you probably won’t want to think about: How much it will cost you if you make a late monthly paymentWhether “negative amortization” is permissible (whether you may be allowed to defer some or all the interest due some months)Your lender’s policy on partial payments if you’re short on a monthly payment Page 5 The last page follows up on the bad stuff. So it reminds you to read your note (mortgage agreement) to know what happens when things go wrong, including what it takes to trigger a default and the circumstances under which your lender can demand early repayment. It gives you the big numbers: the total amount you’ll pay over the lifetime of the loan, together with how much of that is in interest. You’ll also find contact details for all the professionals who’ve worked on your mortgage and purchase. Finally, page 5 requires your signature to acknowledge receipt of the closing disclosure. Don’t worry. Your signature doesn’t mean you agree to the document’s contents. It just shows you’ve received your copy. What if something’s wrong? The whole point of the closing disclosure is to give you a chance to get errors and issues corrected before it’s too late. You only have as little as three days to do so. Please read the document and act on corrections as soon as possible. Chances are, your best course of action is to call the lender or mortgage broker. Your real estate broker or attorney (if you have one) may take up the issue on your behalf also. Remember, your contacts’ names, phone numbers and emails are on page 5. Explain your issue and ask your contact to act on it. Agree to a time by which you’ll get a response. But you have to be fair. It may take some time to sort out something complicated. On the other hand, you’re up against the clock. So “I’ll do my best to fix it before closing” just won’t cut it. Maybe your issue’s small (the pest inspector’s overcharged you $20) or maybe it’s big (your interest rate increased for no reason). But, if it’s big enough to bother you, follow through. Following through Following through includes immediately writing an email to your contact, saying, “Thanks for your help on the phone just now. We agreed …” Then lay out the contents of the call. Be sure to spell out what triggered your call, the action agreed and the deadline for a response. Copy the email to others who may be interested, such as your real estate broker and attorney. There’s a good chance that, by acting early and decisively, you’ll clear the path to a smooth closing. If you’re unsure what happens at closing, read “Mortgage Closing: What Happens At Your Signing.” If you still have any queries, use The Mortgage Report’s Ask an Expert online service. Just post a question and wait for a response from a professional. Verify your new rate (Oct 21st, 2021) Original post here: Use your mortgage Closing Disclosure (CD) to get the deal you were promised Use your mortgage Closing Disclosure (CD) to get the deal you were promised syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/use-your-mortgage-closing-disclosure-cd.html In this article: Real estate closing involves the finalization of all agreements made between the buyer, the seller, and your lender, for the purchase and financing of your new home. Signing the closing documents legally transfers ownership from the seller, and you become the new owner of the property.The closing is attended by your real estate agent, the sellers, the closing attorney or escrow officer, and potentially your mortgage lender (if your lender cannot attend in person, ask him or her to be available by phone).At the closing, you will sign a number of documents, transfer funds, and then the seller will publicly transfer the property to you. Mortgage closing: Signing documents and paying closing costs Mortgage closing is the last step in the exciting process of buying a home. You worked with your lender to get pre-approved for a loan, and you found your dream home. You haggled over the price, and the seller accepted your offer. If this is your first home, or if you haven’t bought a home in the past decade, knowing what to expect can make the difference between an enjoyable home buying experience, or a stressful one. Verify your new rate (Oct 21st, 2021) The escrow process Hopefully, your real estate agent and lender have already walked you through the steps of buying a home and getting a mortgage. Once you sign your purchase contract and open escrow, you must begin your due diligence. The due diligence period varies by state. It protects the buyer and seller. Sellers must disclose anything negative that they know about the home. Buyers obtain inspections, title reports and other information. Your lender will order an appraisal to make sure the property is worth its sales price. That protects you as well as the lender. You’ll comply with your lender’s documentation requirements — supplying income, asset and other paperwork to prove your creditworthiness. After all of the necessary contract contingencies have been satisfied, and your mortgage loan has received final approval, it’s time to prepare for your mortgage closing. What is mortgage closing? Real estate closing involves the final performance of all agreements made between the buyer, the seller and your lender, for the purchase and financing of your new home. Signing the closing documents legally transfers ownership from the seller, and you become the new owner of the property. Who attends the closing? Up until the day of closing, you have probably only had interaction with your real estate agent, your lender and possibly the home inspector. At the closing table, however, you’ll see several faces for the first time. This is likely why the closing table can be intimidating for some. You can expect your real estate agent to be at the closing table. The sellers will probably attend, along with their real estate agent. The closing attorney or escrow officer oversees the closing. It is not uncommon to have your mortgage lender attend the closing. If this person can’t be there, ask him or her to be available by phone in case questions come up. If you can get a copy of your closing documents early, and review them at your leisure in your own home, the process can be much smoother. You can ask your questions and resolve issues without pressure. Most lenders are happy to provide closing documents early if you ask. What happens at closing All buyers whose names appear on the property’s title and/or mortgage documents must bring a government-issued photo ID. Depending on where you live, mortgage closings are officiated by a company known as a title agency or a real estate closing attorney. If you have ever bought a home, unless you paid cash, you know there’s lots of paperwork involved. As a buyer, you will have a lot more paperwork to sign than the seller. You may sign and/or initial more than 100 times. Even with all of the signatures involved, fortunately, closing won’t take all day. According to real estate closing attorney, Gillen Joachim of Ganek, P.C., the typical purchase closing runs “just shy of one hour”. In addition to signing documents, you’ll take care of a few other items. Closing cost reconciliation Buying a home involves a variety of costs. For the buyer, these costs include lender fees and third party charges (appraisals, credit reporting, and inspections). You may pay mortgage insurance premiums as well. You’ll also pay “prepaid items.” These are not loan fees. “Prepaid items” include property taxes, homeowner’s insurance, and per diem interest. The closing agent reviews the final CD, or Closing Disclosure (formerly known as the HUD-1 form) to ensure all numbers that were originally disclosed are as they should be at closing. Transfer of funds The amount needed for closing is typically communicated from your lender several days in advance of the closing. Closing funds cannot be in the form of cash or personal check. Wired funds or cashier’s checks are generally the only acceptable forms of payment received. Your lender or closing agent will verify this information with you prior to closing. Recording public documents After signing documents and paying closing costs, you get ownership of the property. The seller must publicly transfer the property to you. The closing attorney or title agent will then record the deed. You get your keys and officially become a homeowner. Congratulations! What are today’s mortgage rates? The mortgage closing should be an enjoyable experience for everyone. Proper preparation and an understanding of the process are key to a smooth closing. Get today’s live mortgage rates now. Rates are available with no social security number required to get started, and all quote come with access to your live mortgage credit scores. Verify your new rate (Oct 21st, 2021) Original post here: Mortgage closing: What happens at your signing Mortgage closing: What happens at your signing syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/mortgage-closing-what-happens-at-your.html Average mortgage closing times are just that — averages The typical time to close a mortgage ranges from 45 to 60 days. This is the amount of time it takes from loan application to “loan funding” — which is when the new home or refinance loan is officially a done deal. Depending on your loan type, credit profile, and loan purpose (purchase or refinance), your mortgage might close faster or slower than average. If you have not yet applied, or if you have not found the right home to buy, your closing time frame could be longer. Start your mortgage loan approval (Oct 21st, 2021) In this article (Skip to…) Mortgage closing timelineAppraisal to closingClosing times by loan typeWhen to lock your rateWhat affects closing times?Tips to close fasterMortgage closing FAQ How long does it take to close a mortgage? According to loan software company ICE Mortgage Technology, it took 52 days to close a mortgage as of March 2021. But the time to close can vary a lot depending on your circumstances. The time it takes to close a mortgage depends on where you are in the home buying or refinance process. The home loan process itself — from application to closing — generally takes between 45 and 60 days. If you’re refinancing a home you already own, that’s your entire timeline. If you’re buying a new home, though, you have to factor in the house hunting process. You need an offer accepted to get approved for a mortgage – so you can’t start the process in full until you’ve found the home you want. This could add an additional 1-2 months or more onto your timeline. How long a mortgage closing takes if you haven’t found a house yet Closing on a house takes time. Exactly how much time depends on your “starting point.” If you haven’t yet found your dream home, you could spend a month or two just visiting houses with a real estate agent. Once you find the house, it could take one to five days to make an offer, have the seller look at your offer, negotiate, and come to an agreement on price and other aspects of the real estate transaction. At this point, you can make full application for the home loan. (You couldn’t apply earlier because a lender can’t issue loan approval until you’ve chosen a home.) You can speed up this process by getting a mortgage pre-approval as soon as you start looking at homes. Don’t let that 30 to 60 days go to waste. Getting pre-approval means the lender gives a thumbs-up to all aspects of your home loan besides the property. Once you have an accepted offer, your lender already has a serious head start on your final approval. Start your mortgage pre-approval (Oct 21st, 2021) If you have found a house to buy: How long does it take to close the mortgage? If you’ve found a home already, it will probably take between 45 and 60 days to close the home mortgage, based on national averages. Keep in mind your situation can vary widely depending on your credit score, employment history, and other aspects of your financial life. You can speed things along by preparing for the seven steps of underwriting described below. In today’s market, the appraisal report can be a major sticking point. Due to regulations, many appraisers left the business after the housing downturn in the late 2000s. This can make appraisers harder to come by today. Ask your lender about current appraisal turn times based on recent history. One bright spot: Fannie Mae and Freddie Mac can waive the appraisal requirement, even on some purchase loans. This is helping closing times. But you can’t count on that. Be careful not to over promise closing speed to your seller. Your purchase agreement will state a closing date. You are expected to stick to it, or potentially lose the house and your earnest money. Above all, have an honest conversation with your loan officer about how long it’ll take to close on your mortgage loan. Ask for a realistic or even pessimistic assessment, factoring in underwriting, processing, the appraisal, condition review, and closing/funding. It’s better to guess “long” than to have overly optimistic time frames you can’t reasonably hit. How long after the appraisal to close a mortgage? If your appraisal is complete, congratulations. You’ve finished one of the longest steps in the home buying process. You might be wondering how much longer you’ll have to wait. Typically, mortgage underwriters will be working on your approval while the appraisal is underway. So when the appraisal comes in, the lender should be more or less ready to go. It shouldn’t take longer than two weeks to close on your mortgage after the appraisal is done. It shouldn’t take longer than two weeks to close after the appraisal is done. That’s not a promise, though. There are still plenty of potential hang-ups. Your lender could find an issue on the appraisal (peeling paint, a roof in need of repair, etc.) that needs to be addressed. Or the seller might have a problem with the home he or she is purchasing, delaying the sale. But don’t let those items worry you. They happen frequently and are usually resolved in one way or another. Still, be vigilant with your lender. Make sure it is speeding your file through the rest of the loan application process. Mortgage closing times by loan type The type of loan you get can make a difference in your closing time. ICE Mortgage Technology breaks out average closing times by loan type: Conventional loans: 51 daysFHA loans: 55 daysVA loans: 57 days Keep in mind closing times vary widely depending on the situation. A cash buyer, for instance, might close in a matter of days. A mortgage borrower with a questionable credit history and income may need 60-90 days or longer. If you’re trying to close on a home fast, apply for prequalification with your lender as soon as possible — even before you find a home. A word about home closing times and rate locks When you finance a home using a mortgage, your interest rate is based on time-to-close — the fewer days it takes to get you from “rate lock” to “closing,” the lower your mortgage rate will be. This is true for purchase mortgages and for refinance loans, too. For every 15 additional days it takes to close your loan, in general, your quoted mortgage fees increase by 12.5 basis points (0.125% of the loan amount). The fewer days it takes to get you from “rate lock” to “closing,” the lower your mortgage rate is likely to be. However, you don’t get the liberty of choosing the shortest possible mortgage rate lock, then extending 15 days at a time as needed. At the beginning of the mortgage approval process, mortgage lenders require borrowers to state for how long they’d like to lock their loan. The typical mortgage rate locks last for 30 days, 45 days, or 60 days with extended mortgage rate locks available upon request. Ideally, borrowers should choose the shortest rate lock period that allows the lender to complete the loan process; and, for the purchase of a home, that extends through the home’s closing date. Start your mortgage loan approval (Oct 21st, 2021) What affects mortgage closing times? According to ICE Mortgage Technology, it now takes an average of 52 days to close on a new home loan. That’s an average of purchase and refinance transactions. Current closing times are down from 58 days at the end of 2020. Still, it takes longer than most consumers think to close a loan. That means home buyers and refinancing households should plan for longer mortgage rate locks than they initially expect. Remember: Mortgage rate locks move in 15-day increments — and it now takes more than 50 days, on average, to close on a home loan. There are a number of reasons why loans can take longer than 45 days: Mortgage lenders trimmed staff as rates rose through 2018. Now that rates are so low, they are scrambling to hire employees to process loan filesLenders in many states are still dealing with stay-at-home orders from the COVID-19 pandemicA home-buying frenzy is sparking a wave of purchase applicants to buyRising rents, too, are lighting a fire under home buyers All this is creating a crush on mortgage lenders who, frankly, have been unprepared to handle the workload. Despite technological improvements, banks sometimes can’t keep up with demand. Regulations slow down mortgage closings There’s another reason why loans are taking longer to close: the TILA-RESPA Integrated Disclosure laws, which went into effect toward the end of 2015. The gist of TRID is that mortgage lenders must send particular paperwork to mortgage borrowers 72 hours prior to closing, and that changes to any of the documents require a re-disclosure of said terms and another 72-hour waiting period. Since October 2015, then, closings have had an additional three days tacked on; a government-mandated delay affecting all closed loans. You’ll want to check with your lender when choosing the length of your rate lock. Shorter locks are ideal, but not always available. 7 steps to speed up your mortgage closing When your mortgage loan is submitted for approval to a bank, there are roughly seven separate steps in the loan application process. What follows is a brief explanation of each step, and what you might be able to do to speed your loan along. Note: For best results, the first three steps can — and should — be completed prior to shopping for a home. Step 1: The initial mortgage application When you give a mortgage application to your lender, it’s either completed in-person, by telephone, online, or via an app. Completing a mortgage application, if you’re prepared, will take 20 minutes to an hour. “Prepared” means having: Your employment and address information for the most recent two years at the readyYour employer’s and landlord’s contact information handyYour bank statements along with retirement and investment account statementsProof of your income, which may be via pay stubs or tax returns, so the lender can determine your debt-to-income ratio In many cases, after taking your application, a lender will be able to offer a “preliminary approval.” This means your loan is conditionally-approved — assuming you can support the information provided above with supporting paperwork and documentation. Start your mortgage loan application (Oct 21st, 2021) Step 2: Provide supporting paperwork & documentation After it issues your preliminary approval, your mortgage lender will ask you to provide paperwork to document the information you’ve shared as part of your application. Typically, this paperwork includes pay stubs, W-2 statements, federal tax returns, and account statements for your savings and retirement accounts. Other documentation requests may include copies of business licenses, gift letters for down payments, and proof that a student loan is in deferment. After reviewing the paperwork, your mortgage lender may ask for additional supporting information, which may include written explanations for “large, atypical deposits” in your bank account or anything else. Reviewing your loan paperwork is a task typically completed within two days, but it can sometimes take as long as a week. In general, the faster you comply with your lender’s request for paperwork and supporting documentation, the faster your file can be processed. Step 3: The credit approval letter Once the lender has reviewed and “signed off” on your paperwork, it will issue a pre-approval letter to you. A pre-approval letter is your proof that your loan can be approved, so long as the property you purchase meets lender guidelines, and so long as you don’t make any “material” changes to your application. Material changes include a change in employment, income, credit, marital status, or down payment. Changes in your application don’t necessarily nullify your approval. However, they do require that your loan get re-underwritten and re-approved. This could lengthen the closing process considerably. So avoid making any financial changes prior to closing, if at all possible. Start your mortgage loan pre-approval (Oct 21st, 2021) Step 4: The home appraisal As the next step in the mortgage approval process, your mortgage lender will schedule a home appraisal. For home buyers, this step won’t happen until after a home has been chosen and after the home inspection has been completed. Refinancing homeowners who choose an FHA Streamline Refinance or VA Streamline Refinance won’t need an appraisal. Appraisals can take up to a week to complete, depending on the property. It may take a week just to get on an appraiser’s schedule. Therefore, when it’s time to schedule the appraisal, try to schedule it as soon as you possibly can. Every day counts when you’re trying to preserve a rate lock, so if the appraiser wants to come see the home tomorrow morning, find a way to make that possible! Step 5: The lender’s review of the home appraisal After the appraisal is completed, the lender will “double-check” it for validity. In general, mortgage lenders’ appraisal review process is lax — the appraiser is the expert, after all. However, if the appraised value of the home is more than a few percentage points higher than the lender’s expectation for what that value should be, the lender may ask to commission a second, verifying appraisal. Scheduling this second home appraisal can add another week to your closing, which can increase your mortgage rate and closing costs. This is a rare occurrence, however. Most times, lenders will accept the appraiser’s valuation of a home as-is, and will issue a “final approval” which states the loan is approved subject to certain closing conditions. As the borrower, your closing conditions may include finalizing your homeowners insurance policy, depositing your down payment into an escrow account with the title company, and signing your final set of mortgage documents. Step 6: The mortgage loan closing After the lender has issued its final approval, the only thing left to do is to close on the mortgage. However, until the closing has completed, it’s your duty as the borrower to not change anything which could affect your mortgage application. For example, between your final approval and your closing, don’t quit your job, don’t buy a car, don’t put furniture on layaway, don’t apply for a credit card, and, most importantly, don’t miss any monthly payments to a creditor. Any of these events could cause your approval to be revoked. Only after your loan is funded and money has changed hands can the loan be considered final. Step 7: The rescission period (for refinances only) For refinance loans of a primary residence, the closing doesn’t mark the end of the mortgage loan process — there are another three business days during which the loan can be canceled. These three days, known as the Rescission Period, are a borrower’s right. They give homeowners a chance to change their mind and cancel the loan entirely. The three-day Right to Cancel cannot be waived and must be figured into the mortgage rate lock period. Mortgage closing FAQ How long after appraisal does it take to close? About two weeks, typically. But this isn’t a promise. Your mortgage underwriting process could take longer if you have a low credit score or are self-employed and need to submit tax transcripts to document your income. It’s also possible a lender could ask for a verifying appraisal, delaying closing by a week or more. How many days before closing do you get mortgage approval? Federal law requires a three-day minimum between loan approval and closing on your new mortgage. You could be conditionally approved for one to two weeks before closing. Can you close on a house in two weeks? If you’re a cash buyer, you could close on a house within a few days. Closing on a mortgage loan will take longer — almost two months on average. Can a loan be denied at closing? This is rare but not impossible. To avoid this possibility, don’t make any changes in your financial life between making an application and signing the closing papers. Significant changes to your credit history or income could threaten your approval. It’s also possible new disclosures about the property itself could change the lender’s mind about your mortgage. Be sure you’ve read and understand your home inspector’s report before closing. Will I know the amount of my mortgage payments before closing? You can get a pretty good idea of your monthly mortgage payments before closing. But remember, your monthly payments will include more than just repaying the loan and interest.For most homebuyers, monthly payments also include: Property taxes — Mortgage loan servicers collect your property taxes along with your loan payments and then pay your local taxing authority annually; Homeowners insurance premiums — A portion of your monthly payment will also go toward your homeowners insurance annual premiums; Mortgage insurance — Unless you make a 20% down payment on a conventional loan, or are a veteran who qualifies for a VA loan, you’ll owe mortgage insurance premiums each month.These charges vary by loan type and property location. Your Realtor or mortgage broker could help you estimate your overall costs before closing. What are today’s mortgage rates? The faster you can close on a mortgage, the lower your mortgage interest rate can be. Know the steps in a mortgage approval, and where you cut time and corners to get to closing quicker. Get started on your mortgage application as soon as possible to have better chances of a fast home loan closing. Verify your new rate (Oct 21st, 2021) Original post here: How long does it take to close a mortgage? Timeline to close How long does it take to close a mortgage? Timeline to close syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/how-long-does-it-take-to-close-mortgage.html In this article: Being clear to close (CTC) means that you have satisfied all conditions for your mortgage lender. They include: Underwriting conditions for the borrower, such as updated bank statementsFunding conditions, including the payment of closing costs and the down paymentQuality control for the lender, including a final credit check and employment verification Once you are cleared to close, the lender prepares your documents. Next, you review and sign them, and the lender wires funds to your title company (or attorney in some states). Verify your new rate (Oct 21st, 2021) The importance of being clear to close A “clear to close” buyer is in a good position. That’s because the mortgage underwriter has reviewed and approved all documentation required to fund the loan. The lender can then send a clear to close letter. Also, it means you can set the closing date. All that remains is the actual closing process. Related: How to chose the right closing date Getting to this point takes some hard work. First, you must provide a lot of paperwork. You have to meet the minimum criteria. Also, your finances should satisfy the lender. Even then, the task isn’t finished. Learn how you got to this point. Furthermore, find out what else you need to do before you can close. Ask questions about the process. And prepare to respond quickly to final requests. If things go smoothly, you’ll be in your newly bought home in no time. Underwriting requirements Being clear to close requires you to meet underwriting, funding, and quality control conditions. “Underwriting conditions are found in the commitment letter the lender sent you. They’re the things you need to do in order to get a clear to close letter,” says James Dodge, professor of law at Purdue University Global. Things the lender may need from you include: a copy of the signed purchase contractupdated bank statements, pay stubs and tax returnsinfo about large deposits (to ensure you aren’t taking on additional debt)letter or answers about anything unusual related to your financesgift letter (if some or all of the down payment includes a gift from a relative or friend). Funding requirements “Funding conditions are extra requirements. Failing to provide these can prevent you from being clear to close,” adds Dodge. These may include: paying closing costsdepositing the down payment into escrowhaving clear titlepaying outstanding debt obligationsproperly executing loan documents Other requirements Aside from standard funding conditions, other requirements may be added after an underwriter reviews your loan and application. Related: 5 nosy questions to expect from your mortgage lender “This is done for quality control purposes,” Dodge notes. “These conditions can vary. That’s because they’re based on matters that give the underwriter cause for concern.” These conditions can include: Conducting a final credit checkExplaining recent credit inquiries or issues on your credit reportVerifying that you have homeowners insurance (and possibly flood insurance) coverageVerifying employment status How to ease the process There are things you can do to help your cause and speed up the clear to close process. Try these tips: Respond punctually to your lender “Provide the documents they request in a timely manner. They may ask for the same documents multiple times. And some requests may seem irrelevant. Just keep your cool. Give them what they ask for,” says Bruce Ailion, Realtor and real estate attorney. Give only what they ask for “Only provide your lender the documents they request. Do not over disclose any information,” says Theresa Williams-Barrett with Affinity Federal Credit Union. Maintain the status quo “Do not change jobs or quit your job,” cautions Ailion. “In addition, don’t file for divorce or bankruptcy. Try not to get sued. And taking out any other new loans or co-signing a loan for a relative.” Furnish proof of employment “Do you still have the same job you had when you applied for your mortgage? If so, get an updated proof of employment document,” suggests Dodge. “If you’ve changed jobs, get a new proof of employment.” Don’t mess with your credit “Don’t make any new purchases, if possible, between the time you apply for your loan and closing. If you must make a major purchase, talk to your lender first,” Dodge says. “If it’s something small, like a new cell phone, provide the lender with a letter of explanation.” Get your insurance up to snuff “Review the scope of your homeowners and flood insurance coverage with your insurance agent. Furthermore, provide your agent with a copy of your purchase contract,” adds Dodge. “This way, they can determine whether your coverage is sufficient to protect the home you’re buying.” Talk to your closing officer “Communicate with your settlement agent, title company or attorney. Ask if they need anything further from you,” says Jerry Baez, mortgage loan consultant with Orange County’s Credit Union. When in doubt, ask the lender “Do you have any unusual circumstances, such as money gifted from a loved one? If so, reach out to your lender in advance. Find out what info they require,” Dodge says. What happens next Once you are clear to close, you’ve entered the final stretch. “On average, you can expect a 24- to 72-hour turnaround to be cleared to close,” Baez says. Once cleared, your lender will wire funds to your closing officer. This person will confirm receipt and ensure the loan gets recorded with the county. “This is an important point in your journey,” adds Baez. “It serves as final approval. And it grants you the ability to schedule a closing.” Verify your new rate (Oct 21st, 2021) Original post here: What happens when I’m “clear to close”? What happens when I’m “clear to close”? syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/what-happens-when-im-clear-to-close.html In this article: Some mortgage disclosure forms are more important than others. They are: The Loan Estimate form (LE)The Closing Disclosure (CD)Your mortgage Note or Deed Most of the sea of paperwork you’ll encounter can be skimmed. Just remember that you’re responsible for everything in that final set of papers that you sign at closing. Verify your new rate (Oct 21st, 2021) The most important form: Loan Estimate (LE) The Loan Estimate form gives you the most critical facts about your loan. The lender must issue one within three business days when you apply for a mortgage. However, many will give you one, if asked, when you shop for a home loan. Reader question: How can I shop for home loans if lenders won’t give me a Loan Estimate? If you can get a Loan Estimate form, that’s better than just a “worksheet” or “scenario” because it provides certain consumer protections that worksheets do not. If you like an offer from a worksheet, though, and decide to apply for the loan, you will get a Loan Estimate form eventually. What’s on the Loan Estimate? Page 1 of the Loan Estimate form makes it pretty easy to compare offers from lenders. That’s because the loan amount, interest rate, monthly payment and closing costs all appear here. 4 ways to keep your mortgage closing costs low It also tells you if your payment is fixed or adjustable, and how it could adjust if the loan is an ARM. Page 1 also discloses prepayment penalties if they exist. Perhaps most importantly, Page 1 estimates your total cash to close. So there should be no real surprises at the closing table. The loan estimate, in the upper right hand corner of the first page, has a checkbox. This important section tells you if you have a locked interest rate. It indicates how long that lock applies. Other cool stuff on the Loan Estimate Before the introduction of this form in 2015, most mortgage applicants just worked with the lender’s chosen providers and paid the costs they were charged. Today, depending on where you live, you may be able to shop yourself for some of those third-party services, reducing your borrowing costs. Page 2 of the Loan Estimate form indicates what these third party charges are, and if you’re allowed to shop around and choose your own provider. Taking out the garbage: How to avoid junk fees and bogus closing costs You’ll get a Written List of Providers for the third-party expenses. You don’t have to use the lender’s choice of providers unless the law says you do, and this differs among states. Not all let you shop for title insurance, but when you can, there may be a lot of savings on the table. For example, you may be able to get a good discount on title insurance when refinancing if you use the same insurer you used before. The lender won’t know this. You won’t get to pick your own appraiser, however. That’s to make sure that the appraisal is objective. In fact, your lender doesn’t even get to choose the appraiser, either. Comparing lenders with the Loan Estimate The third and final page lets you compare lenders head-to-head. It tells you the total costs of the loan and the mortgage APR, or annual percentage rate. It even lets you compare costs during the first five years of your loan. That’s a useful feature, because most homeowners don’t keep their mortgages for a full 30 years. How to shop for a lower mortgage rate Two loans with the same APR could have very different costs. One might require a lot of money upfront to give you a lower interest rate and payment. Another loan might come with a higher payment, but fewer upfront costs. This five-year comparison is more realistic for many than a 30-year APR vs APR analysis. The Closing Disclosure At least three business days before you close on your home loan, you’ll get a Closing Disclosure, which you can compare to the most recent Loan Estimate you have (lenders have to send you updated ones if the loan’s terms change). How to prepare for your real estate closing For many of the charges, the actual costs have to match or be very close to the estimated costs. Check the Closing Disclosure against the Loan Estimate, line by line. If certain costs exceed the estimate, the lender has to eat the difference, not you. Confusing mortgage disclosures you can pretty much ignore Many trees could be saved if this stuff weren’t required to be printed and given to you. They do make good paper airplanes, however. Appraisal Report Disclosure: It says you have the right to a copy of your appraisalARM Rider: If you have an ARM, this one just repeats what’s in the note and the Loan EstimateAttorney Selection Notice: If you want an attorney at closing, you can have oneAuthorization to Release Information: This doesn’t actually disclose anything, but it’s necessary. By signing, you grant permission to the lender to check your credit and verify employmentConsumer Privacy Policy Notice: It tells you that your financial information is private, and who gets what information regarding your loanEqual Credit Opportunity Act Notice: It tells you that lenders are not allowed to discriminate against those in protected classes (race, age, etc., ) and where to complain if your lender picks on you unfairlyEscrow Account Waiver: If you don’t want the lender / servicer to collect and pay property taxes and insurance premiums, you may have to sign this, agreeing that you’re responsible for those paymentsFair Credit Reporting Act Notice: It says that your mortgage payment history, including default or delinquency, can be reported to credit bureausIRS Forms W-9 and 4506-T: These grant permission to lenders to verify your income with the IRS. So don’t forge any W-2s and you’ll be fine.Name Affidavit: You indicate that you know who you areServicing Disclosure: It tells you that your payments might be collected by a company other than your lender.Tangible Net Benefit Worksheet: In some states, the lender must prove that a refinance will leave you better off than you’d be without it. Because so many people want to refinance to a worse loan….. Government loan disclosures It wouldn’t be a government loan without some extra-special additional paperwork. But these forms are also no big deal. Common government-backed loan disclosures include: FHA Informed Consumer Choice Disclosure Notice Tells you that you may also qualify for non-government loans, and recommends that you compare costs of bothImportant Notice to Home buyers Reminds you that the government backs your loan but does not guarantee the condition or worth of the propertyHUD/VA Addendum to Uniform Residential Loan Application Tells you that if the property does not appraise for at least the purchase price, you can bring in more cash to close the deal, but you’re not obligated toFor Your Protection: Get a Home Inspection Again, the condition of the property is not guaranteed by any agency. You are advised to (but not required to) get a home inspectionHUD Appraised Value Disclosure Confirms the property appraised valueHUD Amendatory Clause This also says that you don’t have to complete the purchase if the property does not appraise for at least the sales price. But this is required by law to be added to your sales contract with the seller if you choose a government-backed mortgage. Much of what you get from your lender can be filed or forgotten. Keep the Closing Disclosure and your Note or Deed (the final mortgage document). The rest can be filed, forgotten, or become part of an origami project. What are today’s mortgage rates? Today’s mortgage rates continue to move within a very narrow range, and they continue to be highly affordable. The mortgage rate is one of the most important terms you will see in that pile of paper. Use your Loan Estimate form to make shopping easier, and compare quotes from several lenders. Verify your new rate (Oct 21st, 2021) Original post here: How to decipher the stack of mortgage loan disclosures from your lender How to decipher the stack of mortgage loan disclosures from your lender syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/how-to-decipher-stack-of-mortgage-loan.html In this article: You’d think supplying your pay stubs and bank statements would be enough to prove to mortgage lenders that you own and earn enough to qualify for your home loan. And that used to be true until technology made it easy for anyone to dummy up phony documents. Expect a verbal verification of employment and more. Lenders may call your employer to verify that your employment is secureThey might double-check your bank balancesThey may audit your credit account balances before closing Verbal verification of employment is just one example of the potential intrusions into your life that are part of many mortgage applications. Verify your new rate (Oct 21st, 2021) What is a verbal verification of employment? Before technology streamlined the mortgage application process, mortgage lenders would send Verification of Employment (VOE) forms to employers to get information about your position, income and job stability. But then automated underwriting systems (AUS) stopped requiring this in most cases, only requiring what was called “alt doc” from most applicants — copies of their pay stubs and W-2 forms. Today, in the wake of the Great Recession and the proliferation of poorly-underwritten loans, lenders must comply with the Ability to Repay (ATR) rule, and that means making sure you can afford your mortgage. So they may call your employer and make sure that your documentation reflects your true income and status. How a verbal verification of employment works Fannie Mae, Freddie Mac or government-backed loans require lenders to confirm the accuracy of the documents you provide when applying for a home loan. Fannie Mae, for example, insists your lender calls your employer no more than 10 businesses days before closing. That call will confirm you’re still employed under broadly similar terms to those when you first applied. Your application will be disrupted if you don’t work there anymore or are making significantly less money. Job change? You can still get approved for a mortgage Fannie’s not messing around here. It insists lenders fully document the call. Also, it says they must independently verify the phone number, rather than rely on the one you’ve given them. For FHA loans, the lender can obtain a written VOE from the employer, or all of the following: copies of the most recent pay stub with year-to-date earningscopies of the original W-2 forms from the previous two yearsdocumentation of current employment by telephone, sign and date the verification documentation, and note the name, title, and telephone number of the person with whom employment was verified None of this means you can’t change jobs during a mortgage application. You need to tell your lender as soon as you know and you must document your new terms of employment. VOEs and the self-employed The self-employed face different VOE rules. In addition to checking your income with tax returns and current financials like balance sheets and income statements, lenders need to know that your business is still, well, in business. They must do this through a third party source: Verify a phone listing and address for the borrower’s business using directory assistance or the Internet (your business must be listed under a company name to use this option)Verify the business directly with a regulatory agency or the applicable licensing bureau by obtaining a copy of the business license, which must be active and in good standingVerify the company’s continued existence with your business CPA Last-minute credit checks VOEs aren’t the only last-minute checks. Your lender will typically pull your credit for a second time in the days running up to closing. This catches out all too many borrowers. It’s natural to make exciting plans for your new home. Maybe you’re out shopping and spot the perfect sofa for your family room. Or perhaps you happen across a special on paint at your local store. You pull out your plastic and … disaster. Solve these 3 problems and improve your credit score fast in 2018 You think you’ve already jumped through all the necessary credit hoops. After all, you have an approved application. Of course, you’ll make sure you carry on paying your bills on time. Applying for new credit, opening new accounts or increasing the balances on your existing lines of credit can delay your closing or derail your loan altogether. Higher balances could increase your debt-to-income ratios and push you over that fine line between approvable and unacceptable. You’re not safe until you close The last-minute verbal verification of employment and credit check are now routine. However, they’re not the only dangers home buyers face ahead of closing. If your lender’s underwriter finds anything that appears inconsistent or unusual, he or she can ask for more information or evidence. For instance, that bank statement you provided shows a few bounced checks. Or an unusually large deposit. Of course, once approved, most applications sail through with no or few queries. Nothing’s final until everything’s finalized, which is when you become the legal owner of your new home. Handling extra hoops Here’s what to do when your lender asks you to clarify a point or provide additional documents: Stay calm and friendly — few loan officers enjoy needling their customers. It’s their job to be sure you’re a good borrowerBe responsive and helpful — you’re the one who’ll suffer most from delays. Provide answers and evidence as quickly as possibleGo the extra mile — volunteer to ask Uncle Henry for his investment account statements to verify his down payment gift In other words, don’t take lenders’ requests personally. See it as your job to help them tick the boxes that their job requires. Ultimately, you both want your mortgage to go ahead. Intrusion that helps you Nobody’s pretending that lenders carry out checks and verifications for anybody’s benefit but their own. They are protecting their own interests. But you are a collateral beneficiary. Because your lender’s objective is to make sure you can comfortably afford your monthly payments. And that’s something you want just as much as it does. Verify your new rate (Oct 21st, 2021) Original post here: Background check: Verbal verification of employment and other intrusions Background check: Verbal verification of employment and other intrusions syndicated from https://reversemortgagesolutions.net/ Read original post here: https://donaldsingeer.blogspot.com/2021/10/background-check-verbal-verification-of.html |