Relocation Connection: Mortgage Information

Arizona Relocation Mortgage Information

Mortgage

When qualifying for a mortgage during the relocation process, your income will be averaged from the last 24 months as long as you remain in the same line of work. FNMA and Freddie MAC are the entities that decide the rules defining what is acceptable; most mortgage brokers and banks would go broke if no one bought the loans that they offer.

Mortgage Options

The standard ratios that lenders like to see, assuming a 5% Down Payment and absolutely perfect credit, is no more than 33% of your gross income going towards car payments, installment debt, mortgage, etc. With a 10% down payment, it increases to 38%, providing your credit is perfect. If you are putting 20-25% down on your home, a whole new world of options unveils. There are loans without income verification with good credit, some even offer no qualifying with 25% down, etc.

Lenders and Rates

To compare interest rates between companies, you must do it in the same day as all rates are tied to an index that changes daily. You can lock in your interest rate within 60 days of closing. I can recommend several lenders that have inexpensive fee structures for securing a loan at very competitive rates. Also, when you shop new homes the builders may give you incentives to use “their preferred lenders” but my lenders usually beat their incentive! If they can’t, they will let you know up front. I always recommend that my clients get a second opinion on new homes.

Mortgage Checklist

In today’s global market, lenders will ask lots of questions and you need to be prepared to answer them. Here is a check list for your convenience:

Delay in getting any of this information to your lender may cause your loan not to close on time. If you do not close as per the contract, you can lose your earnest money. So time is of the essence.

Property:

Sales contract
Property Description/copy of the listing
Current loan information and/or landlord information

Personal:

Most recent pay stubs covering 30 days
W-2 forms for the previous 2 years
Signed IRS tax returns, all pages for previous 2 years
Year to date profit and loss statement for self employed
Corporate tax returns and all schedules for the preceding 2 years
Social security and/or pension award letter
Divorce decree and/or separation agreement
Letter of explanation for any gaps in employment within the last 2 years
Alimony and/or child support information
Driver’s license and social security card

Assets:

All pages of all bank statements for the last 2 months
IRA’s, 401K, CD’s, Annuity, checking, savings, etc.
If receiving a gift, you must have a copy of the check, copy of account where it came from, copy of deposit receipt and a letter explaining that it is a gift and doesn’t need to be repaid.
Cancelled earnest money check and receipt from title
Lease agreement or sales contract on all real estate owned
Stocks and bonds if not in brokerage account, all pages

Liabilities: