Loan Processing
Once all preliminary information has been given to your Loan Officer, verification forms will be sent to your employer(s), bank(s), and current Mortgage Company or landlord. A credit report and appraisal of the property will be ordered. You will have to sign a release form at the time of application to authorize this.
Your lender will provide you with a Good Faith Estimate (GFE) and a Truth-in-Lending Disclosure.
Key Mortgage Documents
Good Faith Estimate
The Good Faith Estimate lists the costs you will incur in financing your new home.
Truth-in-Lending Disclosure
The Truth-in-Lending Disclosure shows the total cost to you (over the term of the loan) for your specific financing.
Verification of Employment (VOE)
VOE forms are sent to all employers for the last two years. The VOE is completed, signed by the employer, and returned to the Mortgage Company. This will show the date you began your employment, the amount of money you earned last year, and how much you have earned so far this year. The VOE also indicates what bonuses and overtime have been earned.
Verification of Deposit (VOD)
VOD forms are sent to each banking institution listed on your application. The bank(s) will indicate the date you opened each of your accounts, the average balance in each account for the last three months, and the amount of money you have in each account on the day they complete the form. Any loans or overdraft accounts you have with the bank will also be shown.
Verification of Mortgage (VOM)
Mortgage companies and landlords complete verification forms by telling the mortgage company how much you owe them, what your monthly payment is, and your manner of payment. They will normally indicate whether you made your payments by the due date or after.
Credit Report
The credit report will show what amounts of money are owed to each of your creditors. Minimum monthly payments and your manner of payment will also be shown.
Appraisal
The final appraisal on the property confirms for you and your mortgage company that the property is worth what you are paying for it.
Timing
It normally takes several weeks for these reports and forms to be returned to the Mortgage Company. If any delays are encountered, your Loan Officer may contact you for assistance. The credit reporting agency may call you to verify that the information they have gathered is correct.
Once all required documentation has been compiled, you may be asked to write letters in regard to your assets, income, or credit. Please remember that your mortgage company requests these letters to assist you in obtaining your financing.
It is at this point that you may become frustrated with the loan process. Do not hesitate to discuss your concerns with your Classic Sales Counselor or Loan Officer; perhaps they can provide some additional insight on what may seem to be minor and/or redundant requests.
Verifying the Final Sales Price
Prior to the Loan Processor working up your file, they will verify the final sales price. Make sure that the Purchase Agreement and all Addenda have been sent to the lender. This assists the lender in determining the exact loan amount.
If any changes occur which will affect the sales price or loan amount after this time, the loan may have to be resubmitted, which could delay final loan approval, or additional items may have to be paid for in cash.