5 Easy Steps to Homeownership...

STEP 1

Organize Your Documents

In order to apply for a loan, you will need to provide copies of all of the following items.
Organize your Documents:

• Past 2 years' tax returns and W-2s
• Past 2 years' employment history
• Last 3 consecutive paycheck stubs (5 if paid weekly)
• Name, address and phone for past 2 years' residence(s) and landlord(s). Renters should bring evidence of 12 months' rent payments
• Last 3 months' statements for savings, checking, CD, money market accounts, etc.
• Recent statement on retirement accounts (IRA, 401K, 403-B, Annuity, etc.)
• Monthly payments and balances on all open accounts
• Divorce decree (if applicable)
• Bankruptcy schedules/Discharge papers (if applicable)
• If you are NOT a US citizen, provide a copy of your green card (front & back). If you are NOT a permanent resident provide a copy of your H-1 or L-1 visa.
• Copy of Purchase Sales contract or Offer to Purchase and all addenda (signed by buyer and seller)- If you do not have a property yet, it’s OK, you can proceed without this item.

Pros of Homeownership

Cons of Homeownership

• Equity investment
• Tax deductibility of interest and property tax payments
• Stable housing costs
• Freedom and control

• Mortgage debt
• Market risk
• Property taxes
• High cost of homeownership
• Decreased mobility
• Repairs and maintenance

STEP 2

Get Prequalified

After Step 1 is complete, you will be ready to get prequalified for a mortgage loan. The prequalification process is easy, and it will let you know what price range you can afford when shopping for a home. You can complete your prequalification over the phone or make an appointment to meet with one of our loan officers.

Call (877) 475-2594 to speak directly with a loan officer. You can look HERE to see what types of loan programs are currently available. It is extremely important to provide accurate information so that we can tell you which programs you are eligible for and the purchase price for which you qualify.

About Prequalification

• Fill out the Clearinghouse CDFI loan application package and submit it to your loan officer. Your loan officer can also take your loan application over the phone.
  (Please Call and speak with a loan officer prior to filling out a package.)
• Gross household income. The loan officer will ask you to send a copy of your pay stubs, W-2s and tax returns so we can accurately assess your income.
• The amount of cash you have to contribute to your home purchase. The loan officer will ask you to send a copy of your bank statements to assess your assets.

During this process, we will run your credit report, so we will need a signed credit authorization form for each borrower. We will also need a check for the amount of the credit report fee of $16 for each borrower, or $26 for a married couple. Checks can be made payable to Clearinghouse CDFI.

Once you are prequalified, your loan officer will provide you with a prequalification letter that you will use in your search for a home. Realtors will often ask for a copy of this letter when an offer is submitted on a house.

A prequalification does not constitute a loan approval. Your loan is not approved until you submit all of your documentation and your loan is submitted to underwriting for a full review. This is done after you have entered into contract on a home.

Application Packages

• Credit Authorization
• FHA Loan Application
• Conventional Loan Application

STEP 3

Shop for a Home

Once you find a home in your price range that suits your needs, your real estate agent with work with you to submit an offer. Be prepared to give an earnest money deposit if your offer is accepted. This deposit should be no more than 2% of the purchase price and will be held in a trust account until escrow closes. The loan process is taking longer these days, so longer escrow periods are preferred, usually 45 to 60 days.

Always remember to maintain constant contact with your loan officer when submitting offers on homes in case there has been a change in underwriting guidelines, which happens frequently. Once you have an accepted offer, your loan officer will let you know what you need to do to continue processing your loan application.

STEP 4

Final Loan Approval

Once your offer has been accepted, your loan officer will work to get your loan submitted to the underwriter for final approval. The loan officer will order an appraisal on the property. In order to do this, they will need the Appraisal Order Authorization Form to be filled out by whoever will be paying for the appraisal. Appraisal fees range from $385 to $420 depending on the type of loan program.

At this point your loan officer will begin verifying the following information:

• Employment History
• Assets
• Property value
• Additional documents or verifications specific to your situation

Expedite Your Loan Approval:

• Respond Promptly to all requests from the escrow company or your loan officer. This is critical if your rate is locked or if you plan to close by a certain date. Once the underwriter looks at your file, there will most likely be loan conditions and requests for additional documentation.
• Avoid Debt Fluctuation. Keep in mind that anything that causes your debts to increase might have an adverse affect on your current application.
• Your Bank Account(s). Do not move money into your bank accounts unless it can be traced. If you are receiving money from friends, family or other relatives, please contact your loan officer.
• Be Available. If at all possible do not go out of town until after your loan closes. Please speak with us to arrange for extenuating circumstances.
• Credit Applications. Notify your loan officer before applying for any other credit, including credit cards, personal loans or even with another mortgage company. Some loan programs have strict guidelines regarding your credit score. Credit inquiries my lower your credit score and may have an adverse affect on your loan approval.

Forms

• Appraisal Order Authorization Form

STEP 5

Final Documents

Once your final loan approval comes through, we will draw loan documents. We will normally send them to the escrow office for signing, as there has to be a notary present. The escrow officer or your loan officer can help to explain all of the documents that you will have to sign. You will need to bring a cashier’s check for your down payment and closing costs if required. Your escrow officer will let you know exactly how much you will need to bring in. Review your loan documents to make sure the rate and loan terms are correct. Verify the accuracy of the name and address on your loan documents. Sign the loan documents. The notary will require that you have a picture ID with you.

Once loan documents have been sent back to the lender’s office, your loan can be funded. Once the loan goes on record with the County, you will get the keys to your new home and be able to enjoy your dream of homeownership!