In the last section we briefly spoke about the Appraisal Report and additional documents that may be needed by the first time home buyer to receive a clear to close. This section will be about the documents needed for the general application.
The general application for a loan is called the Uniform Residential Loan Application, or the 1003. First time home buyers will hear more mortgage-savvy individuals will refer to this as the “Ten-Oh-Three” form. This form is the form that the first time home buyer will submit along with all of their income, assets and legal documentation to a lender. This information needs to be filled out as completely as possibly by the first time home buyer. The first time home buyer will be assisted by the loan officer when filling this form out for their first home loan. The first time home buyer’s responsibility is disclosing all of the information for the Loan Officer on this form, and being as accurate as possible. The purchase contract will be there to provide the information in regards to the loan type, amortization period, and the property information. The property information basically indicates what kind of property this will be, whether it’s a regular loan, new build, or refinance. Each section has specific information that will be need to be filled out together with the first time home buyer’s loan officer.
The next couple sections of the Uniform Residential Loan Application have to deal with borrower information. This information is absolutely crucial and will need to be as accurate as possible. This will be personal information such as date of birth, social security number, and current address. This will also include if there’s a co-borrower on the loan as well. The first time home buyer will also input their work information, including employer and work history. For USDA and FHA guidelines, the underwriter will need the last 2 years of employment, so if there are multiple employers this section has a place for this additional information. The underwriter will require a verification of employment from all of a first time home buyer’s employers within the last two years of employment.
The next section will be detailing assets and liabilities. This section will be asking about all of your bank accounts, IRAs and/or 401Ks or any other retirement accounts. The first time home buyer will also notice there’s a “liabilities” section. This section will also be requiring any current bills and monthly payments, such as a personal or car loan. These must all be documented so the loan officer and the underwriter can get an accurate representation of a first time borrower’s debt-to-income ratio, as well as assets that are available for the loan. For any legal related debts, such as child support or spousal support, there is also a section for this information to be added. The loan officer and underwriter will be looking for proof of all of these documents as well.
The other sections are for demographic information and disclosures and instructions about the document itself. The information added here should be as accurate as possible as well.
For the next section, we will be talking about the Conditional Approval and Closing. Take care!