Applying for a Home Loan
by Ellise Walsh

Buying a home is one of the most important, certainly one of the most expensive, financial commitments any person will make in their lifetime. Since few of us have the vast sums of cash its takes to buy a home just lying around, for most people buying a home means applying for a mortgage.

While applying for a mortgage may not be anyone’s idea of a good time, it is necessary to do the research it takes to get the best deal. If you put as much time and effort into finding the right mortgage as you do finding the home in the first place, you can assure yourself of getting the right deal.

Applications for mortgage loans tend to be long and complicated, but by preparing ahead of time and understanding the forms, you can make the process of applying for a mortgage as painless as possible. Before beginning the application, it is important to make sure you gather all the pertinent information. You will need, at a minimum, your Social Security number, information about your current and previous jobs and residences, recent pay stubs from your current employer, copies of tax returns, information on your credit card and loan payments, copies of bank statements, and copies of statements from brokerage firms or other financial institutions.

It is best to begin filling out the form simply by completing each line with the requested information. You will probably need to leave Section I, the Type of Mortgage and Terms of Loan part, blank for now.

Next is Section II, entitled Property Information and Purpose of Loan. You will only complete the subject property address line after your offer on a property has actually been accepted. If you do not yet have an accepted offer on a property, you should just state the purpose of the loan as either purchase or refinance. Also complete the line indicating the type of property for which the mortgage is being sought, i.e. primary residence, secondary residence or investment property. Be sure to also complete the names in which the title to the property will be held, how the title will be held, and the sourcefor the down payment. In most cases, the source will be cash.

Section III is the Borrower Information. Into this section will go all your personal information, including your name, your Social Security number, your phone number, your age, your marital status, and your present and previous employers. You sill also need to provide family information, such as the number and ages of your children.

Section IV is for Employment Information. This is where you will provide detailed salary information.

Section V is the Monthly Income and Combined Housing Expense Information section. You will need to reference your pay stubs to complete Section V.

Section VI is the Assets and Liabilities section. This section can be completed by using your bank statements and your credit card or loan statements.

Section VII is the Details of Transaction section, and it should be left blank.

The final section is Section VIII, the Declaration statement. You simply need to sign the declaration and date the application. You will also need to sign Section IX, the Acknowledgement and Agreement.

Knowing what to expect before you are handed your mortgage application form will help make the process go a lot more smoothly.

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