As you begin the mortgage application process it is difficult to know what to expect, especially for a first-time homebuyer. During the mortgage application process there are many documents your lender will need to collect from you to complete the loan.
When you begin your full application, you are typically asked about your income, debts, credit score, what kind of loan you are looking to get, and more. However, typically during this first step, most of the information you gave them will not be verified until before closing. With unverified information the lender can issue a pre-qualify letter. A pre-qualify letter is a letter that states that, as long as the information given to them is correct and verifiable, you qualify for the stated amount. They also state in this letter exactly what they need to verify that information. At Alltrust credit union the prequalification letter is subject to:
- Returned Signed Disclosures
- Receipt of signed Purchase and Sales Agreement
- Satisfactory appraisal of the property by an Alltrust Mass Credit Union approved appraiser
- Satisfactory verification of income
- Satisfactory verification of assets
- Satisfactory credit history
- Satisfactory title search and title commitment by an Alltrust Credit Union approved attorney
- Final approval by Credit Union underwriter
Pre-qualifications can typically be completed in around 30-45 minutes when you first meet with the lending agent. Most lenders today typically give out pre-qualifications for the house hunting process and no pre-approval letters. If you need a pre-approval letter for any reason you need to know it can take a few days to complete. Pre-approval letters are different from pre-qualification letters because lenders must verify your income, asset and debt information before it can be finalized. This takes more time because you will have to collect and submit those documents to your mortgage lender, and they will have to verify and check the documents sent. After a pre-approval letter is sent more documentation is still needed to complete the application process. This paperwork for Alltrust includes but is not limited to*:
- Assets: bank statements
- Property preliminary tax report/title commitment together with a 24-month chain of title and MLC/tax info
- Property Appraisal
- Establishing membership and opening a savings account with Alltrust
- Mortgage Insurance Certificate
- Income: Paystubs (typically within 60 days of closing)
- Property: Flood or Hazard insurance – if applicable
As stated in most Purchase and Sale agreement you also need the following*:
- Certificate of Occupancy
- Certificate of Compliance for Septic – if applicable
- And any other paperwork/certificates requested
At closing, the following conditions must be met*:
- Income: Verbal Verification of Employment
- Credit: Reverification of debts – 10 days prior to closing
- Closing: Funds to close
- Closing: Same Name Affidavit
It can take 40-45 days to complete the full loan process after your offer on a home has been accepted. This why it is best to find a lender before beginning your home search so you will have the pre-qualification letter to submit with an offer. It also allows the closing process to run more smoothly.
Check out our mortgage programs here.
Do you have any topics you want us to cover? Send questions to media@alltrustcu.com
*Documentation requested may vary depending on situation and if any other verification or information is required.