A DBA of Mann Mortgage LLC NMLS #2550

Understanding the Homebuying Process

• Terms Glossary• Steps in the Road to Homeownership• Tips for Staying Approved• Required Documents

Lending Terms to UnderstandPrequalificationPrequalification occurs before the loan process formally begins. The lender gathers financial information from the borrowers and makes a conditional determination about their qualifications for a loan.

ApplicationThe application is the beginning of the formal loan process. The applicant completes a mortgage application with the mortgage professional and supplies all of the required information and documentation for processing. Various down payments and closing costs are discussed at this time, and the borrower receives a good faith estimate (GFE) and a truth-in-lending (TIL) statement that itemize the rates, loan fees and associated costs for obtaining the loan.

Preapproval LetterA preapproval letter is a statement from a lender that you qualify for a specific mortgage amount based on an underwriter’s review of all of your financial information: credit report, pay stubs, bank statement, salary, assets and obligations.

ProcessingThe lender reviews the documentation and provides a loan package for the loan underwriter.

UnderwritingAn underwriter determines whether the information provided is acceptable to offer the applicant a loan. If more information is needed, the applicant is contacted to supply it.

Mortgage InsuranceFor a conventional loan, mortgage insurance is required when the down payment is less than 20% of the loan amount. FHA and VA loans also require mortgage insurance or similar protections.

Pre-ClosingDuring this period, title insurance is ordered, all approval contingencies are satisfied and a closing date is scheduled for the loan.

ClosingAt the closing, the lender “funds” the loan with a cashier’s check, draft or wire to the selling party in exchange for the title to the property. This is the point at which the borrower has completed the loan process and the transaction is “closed.”

We thoroughly review your financial profile, which includes your assets, income, credit and property type. We will discuss financing options and determine a loan that's suitable for your situation.

Once we have received all supporting documentation and your application is complete, your credit file will be assessed for preapproval.

After we receive a fully executed purchase and sale agreement, an escrow account will be opened and a title report requested. Once all inspection/ repair contingencies have been satisfied, we will order an appraisal and a homeowners insurance binder.

Escrow will be opened and a title report requested. Additionally, we will order an appraisal and a homeowners insurance binder.

Your property documentation, along with any other outstanding conditions, will be sent to underwriting for credit decision. Additional documentation may be requested at this time.

Once all conditions are received and cleared by the underwriter, your loan documents will be prepared and delivered to the title company.

The escrow officer will receive your loan documentation/instructions from the lender (please allow up to 48 hours for preparation). The escrow officer will contact you for a time to sign.

The signed documents are returned to the lender for review. Funds will be released to the title company for disbursement once all terms have been met. Funds will be used to pay items identified on the closing disclosure.

When all funds have been received and disbursed, the title company will record your new lien at the county. CONGRATULATIONS!

STEP 1: Apply for a Loan

STEP 2: Preapproval

STEP 3: Property Review (for purchase loan)

STEP 3A: Property Review (for refinance loan)

STEP 4: Credit Decision

STEP 5: Loan Docs Prepared

STEP 6: Signing

STEP 7: Funding

STEP 8: Recording

The Road to Home Ownership

Without a preapproval, you may be limiting your possibilities of getting a house. A preapproval letter alone will greatly increase your purchasing power by allowing you to determine what you can afford and significantly narrowing your home search.

Not only is it important to get approved, but you must STAY preapproved through the process. Here are some helpful tips to help you get and STAY approved.

INCOME Don’t make any changes that could affect your income or credit score

NO: Major Purchases NO: Quit or Change Job NO: Close or Open Credit Cards

Things to Do

• Pay ALL your bills on time including mortgage or rent payments.

• Maintain the balances on your credit cards and continue to use your credit card as you normally would.

• Keep credit card balances at or below 40% of credit limits.

• Stay employed and do not change jobs.

• Keep your account balances at or above the amount when you started the loan process.

• Call us with any questions or concerns.

During the loan funding process, PLEASE contact me before making any financial decisions that may affect your credit or if you have any

questions about maintaining your preapproval.

Things to Avoid

• Quit your job or change jobs unless it is the same line of work and for equal/more money.

• Travel and not inform us where you will be and when you will return.

• Cosign for anyone else on any type of loan.

• Transfer large sums of money in or out of your bank accounts.

• Buy an automobile or make other major purchases including other real estate.

• Add debt of any type or have your credit pulled while you are in the loan process.

Tips on how to STAY PREAPPROVED

Identity � Full legal name, Social Security

number and birthdate (in some cases, you may be asked to provide a copy of your Social Security card)

� Phone number, email address, and current and former residential mailing addresses over the last two years

� Primary/secondary income amounts and sources

� Government-issued photo ID

Income Verification � Names, addresses and phone

numbers of all employers over the last two years

� Values of bank, retirement, investment and other asset accounts

� Monthly debt obligations

� Address of property being purchased, year built, est. down payment amount and purchase price

� Estimates of annual property taxes, homeowners insurance and any homeowner association dues

Income Verification (self-employed)

� Federal tax returns (personal and business) for the past three years

� Profit and loss statement (year-to-date)

� List of all business debts

Income/Tax Documents � IRS Form 4506-T: Request for

tax transcript, completed, signed and dated

� Pay stubs covering the last 30 days

� W-2s for the last two years

� Federal tax returns (1040s) for the last two years

� Asset/bank statements: Most recent two months’ statements for all accounts listed on the application (include all pages of the statement, even ones that are blank)

� Written explanation if employed less than two years or if employment gap exists within the last two years

Credit Verification � Credit explanation letter for late

payments, collections, judgments or other derogatory items in credit history

� Source of funds documentation for any large deposits on asset or bank statements

� Judicial decree or court order for each obligation due to legal action

� Bankruptcy/discharge papers for any bankruptcies in credit history

� Payment history for public utilities, phone, cable TV

Other � Homeowners insurance

information, including agent’s name and phone number

� Purchase contract signed by all parties

Required DocumentationGather these documents to help make your loan application a breeze!

Monument Home Loans is a DBA of Mann Mortgage LLC, NMLS#2550. Mann Mortgage, LLC is not endorsed by, nor acting on behalf of or at the direction of, the U.S. Department of Housing and Urban Development, Federal Housing Administration, the Veterans Administration, the U.S. Department of Agriculture or the Federal Government. All programs are subject to credit and income qualification. This is not a guarantee of financing or a firm offer of credit.

What sets Monument Home Loans Apart?Our service. While our interest rates are quite competitive, our customer service is what sets us apart. From your first phone call until your final signature, our loan officers and processing team are fully accessible whenever needed, day or night, weekday or weekend. We also understand that mortgages should not be one-size-fits-all; that’s why we offer one of the widest arrays of mortgage products in the DMV, and work closely with each client to identify the program that best meets their needs and goals. As a result, we enable people from all walks of life to experi-ence a smooth, predictable process that results in the best mortgage for their circumstances – and to have an experienced loan officer with them every step of the way.

MONUMENT HOME LOANS4075 Wilson Blvd, Suite 823 Arlington, Va 22203 703.650.7431www.monumenthomeloans.com

Joe PrenticeSales Manager

NMLS# 1610163

Robert MartinsonBranch Manager

NMLS# 470762

Ru ToyamaLoan Officer

NMLS #1528382

Taylor ByrdLoan Officer

NMLS# 1858602

A DBA of Mann Mortgage LLC NMLS #2550

Scott GordonLicensed Processor

NMLS# 483765