CLOSING YOUR LOAN
Since I have gone over the things that tend to be stumbling block, if not deal breakers, let’s go over things you can do to help ensure that your mortgage loan funds, and in a timely manner.
Let’s start with assessing the possible value of your home. Hopefully you kept a copy of your last appraisal. If you have it look it over. Depending on where you live, if it has been a few years since your last refinance you are probably safe in assuming it has at least retained its value. This can be tricky now because if you live in an area hard hit by the housing bubble bursting, you may have lost value.
See if there are any improvements made since the last appraisal, those will help in a big way. Maybe you have added on a room since then, or turned the basement into an apartment. Put that with the fact that you have not refinanced it three years and you have a good prospect of there being enough equity to refinance. If you know for a fact that the similar house next door just SOLD for a half a million bucks tell you’re LO so he can give the appraiser a heads up. The appraiser may not have that listing yet.
When it comes to your income, try to go the traditional route, using two years W-2’s and pay stubs, it will save you some headaches down the road. If you have more than a couple NSF over the last year or so you may need to use another method for showing income. Check with your LO about the companies guidelines for NSF. Before you commit to anything brainstorm with your mortgage guy to find out what
the alternatives are. Will going stated, which means a higher rate, make sense? What about a NINA (No income no asset) deal work? Do they even have that animal anymore? How about a NO DOC loan. That too may have gone the way of the dinosaur since the housing bubble burst.
Remember just because your lender offers it, that doesn’t mean the idea doesn’t suck; so to speak. If you do use bank statements be sure to have everything in order and labeled before giving them to your mortgage guy. If you have ever gone through another person’s statements you know what a nightmare it can be to organize two years of someone else’s statements. Believe me, I know. I have been there done that way too many times....’’
One of the biggest headaches lenders have, therefore LO’s have, is difficulty in getting the right docs, and in a timely fashion. At the least you will need to furnish the latest mortgage statement you have, proof of insurance, two years W-2’s and last two months pay stubs, or a 1099 if self employed.
Make sure your lender has your home phone as well as your cell phone so he can call whenever there is an issue that needs your attention. And, if you give out the numbers, answer them. Nothing is more frustrating than something comes up and you cannot get a hold of your borrower for days on end. Just keep the lines of communication open and you will have a greater chance of closing your loan and with minimal headaches.
Good luck and happy borrowing.
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