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Mortgage FAQs for Agents

Real estate agents are an important part of the mortgage process. As an agent, you work with purchasers who have varying amounts of experience buying homes and acquiring mortgages. For the first-time home buyer, more support will be necessary to explain the different types of mortgages, the process of applying for a loan and financing a home. Kent Hackman of United Mortgage provides answers to some of the most frequently asked questions below:

 

What is the difference between a pre-qualification and pre-approval for my buyer?
Many home buyers believe that a pre-qualification is the same as a pre-approval. This is incorrect. A mortgage pre-qualification is an estimate only of how much a buyer can borrow. A mortgage pre-approval, on the other hand, is what every home buyer should obtain prior to looking at homes. A mortgage pre-approval is a written commitment from a mortgage lender. To obtain a mortgage pre-approval a buyer will be required to provide the same documents that are required when formally applying for a mortgage, such as W-2s, pay stubs, and bank statements. At United Mortgage we know your closings matter and we make sure your buyers have been pre-approved fully for you.

 

What documents will my buyer need?
Proof of income and assets for down payment, personal identification, and information about your credit history. If self-employed, up to 2 years tax returns will be required. What can the buyer do to avoid slowing down the process? Fully complete all required loan documents, be readily available to answer any questions from the loan officer, and avoid adding any new debt or changing jobs during the loan process.

 

How long does it take to get a mortgage?
The length of time it takes for a mortgage loan to get approved and closed will vary from lender to lender. United Mortgage strives to make sure loans are closed as quickly as possible, and even guarantee closing dates! When shopping around for mortgages, it’s extremely important to ask how long a mortgage lender will take to get their loans approved and closed. We are able to close loans in less than 30 days and guarantee your buyer’s loan request will be our priority.

 

Do all loans have PMI over 80%?
No. We have numerous loan programs that don’t require PMI or even reduced PMI rates.

 

Are you a Mortgage Broker or Direct Lender?
We are a direct mortgage lender which means we fund and control our loans throughout the entire loan process. We ensure that your clients get the best loan, and that the loan process is smooth for everyone involved. We believe that being a direct lender is the best way to ensure satisfaction for you and your clients.

 

What does APR stand for compared to the Note Rate for my clients?
Mortgage APR is the cost of the loan expressed as a percentage, taking into consideration different loan charges including interest. The APR is the true cost to the borrower for the mortgage assuming they keep the loan for the entire term. If they pay more to principal or refinance, then the APR will be affected accordingly. Consumers’ payments are based on the note rate and borrowers should be aware of inflated APRs, which would imply higher than normal fees.

 

Can United Mortgage guarantee we will close my buyer’s loan on time?
Yes!  Over 3 years ago, United Mortgage created an “on-time closing guarantee” to ensure just that, including a credit back of up to $500 if we don’t meet or exceed our guarantee.

 

Is there a fee charged to begin the application process for my buyers?
With United Mortgage, your buyers can apply for a home loan at no charge. With their permission, we will review their credit report and supporting documentation to ensure everything is ready to move forward!

 

How long is the pre-approval valid for my buyers?
As long as the information originally provided does not change, pre-approvals remain valid for 90 days. If information does change, such as income or debt, then we would need to pre-approve the borrower based on this information.

 

Can my buyer bring a personal check to closing?
Unfortunately no, they will need to bring certified funds, such as a cashier’s check from the account that was disclosed on the application. Many title companies will also accept a wire transfer for an additional fee.

 

Can a Veteran have more than one VA Loan?
Yes.  Under certain eligibility, the veteran can have more than one mortgage which could save a deal if trying to close before their other house sells.

 

What are the steps of the mortgage process?

1.) Prospective client contacts United Mortgage for pre-approval
2.) Loan officer gathers all required items for pre-approval and issues the pre-approval letter
3.) House shopping time!
4.) House Under Contract
5.) Loan application disclosures are compiled to get loan into underwriting
6.) The appraisal can be ordered once loan disclosures have been signed, and inspections go well
7.) Initial Underwriting approval
8.) Loan conditions are sent to processor and loan officer to review and gather anything needed for loan to get cleared for close
9.) Appraisal received
10.) Resubmittal of any outstanding conditions to get loan into a final approved status
11.) Initial Closing disclosure preparation started and 3-day clock starts
12.) Closing day setup with title and realtor partners
13.) Closing!
14.) Funding—this occurs when all parties have signed and agreed to the final terms