Mortgage Loans 101 and St. Louis Mortgage Rate Update

Obtaining a mortgage to buy a home, or to refinance an existing mortgage, can sometimes be a little intimidating to borrowers, but it needn’t be.  Granted, this is something the typical person only does every few years at most and regulations continually change the process, but that’s where lenders such as myself come in to the picture, to provide you the info you need and to  guide you through the process. 

Here’s a run-down on the steps to getting a home mortgage:

Application

Paramount Mortgage Company’s Loan Originators will meet with prospective borrowers to begin the actual loan application process. Prior to this first meeting the prospective borrower will be asked to provide certain documents, e.g. Paycheck stubs. W-2’s, Bank Statements etc.

Discussion during this meeting will center on the needs of the borrower. Questions like: “How long do you plan to be in this home?” and “Are you a first-time homebuyer?” will help Paramount’s Originators better determine the most feasible loan program to discuss. Several potential loan programs may be discussed as well as the advantages, fees and down payment options.

Paramount’s Loan Originators will complete the loan application form during this meeting. The loan application identifies the property being financed, the source of down payment, the borrowers’ employment, assets and liabilities. The loan application will also include loan type, term and rate. Along with the loan applications the borrower will be provided with certain regulatory disclosures.

A Good Faith Estimate and initial Truth-in-Lending Disclosure will be issued within 3 days of loan Application.

Processing

The Loan Originator will return the application for verification and processing. Paramount’s qualified Loan Processors review documents submitted by the borrower as well as the credit report. Verification of income, assets and liabilities will also be necessary during the processing of the loan application. Borrowers may be contacted throughout the processing if questions arise. The borrower should also feel free to contact Paramount.

Services pertinent to the property will be ordered by the Loan Processor at this time. Property appraisals, title searches and flood certifications will be completed by third-party providers. These services are required to protect the borrowers’ and lender’s investment in the property.

A final review of the supporting documentation will be made by the Loan Processor. If additional items are needed the processor will make contact with the borrower.

Underwriting

Underwriting takes place to ensure the loan application meets all applicable guidelines. Paramount’s trained Underwriters review employment history and credit history to establish the borrowers’ willingness to repay the loan. The borrowers’ overall debt (including the proposed housing expense) as it relates to the borrowers’ verifiable income is also reviewed.

The property appraisal is also reviewed by the underwriter. During the review of the appraisal the underwriter will assess the subject property’s comparable sales as a means of justifying the property value.

Paramount’s Loan Originators and Processors work hard to present the best financial picture of our clients. Loan applications that meet all guidelines will be approved without delay. All required parties will be notified of the loan application approval. Items necessary to close the loan will be outlined in the approval notice.

Unfortunately, not all loan applications will meet guidelines set forth. The Loan Originator will contact the borrowers to discuss the situation and may suggest alternatives

Closing

Items outlined in the approval letter, such as proof of homeowner’s insurance or flood insurance (if applicable) will be cleared prior to the actual signing of closing documents.

Paramount’s Loan Closer will coordinate with the borrower and the title/escrow company a date and time to sign the documents. When the closing date arrives, Paramount will be there for the borrower at the closing table. We strive to ensure every closing takes place as smoothly as possible. Our presence enables transaction to take place without delay.

Loan Servicing

After closing, your loan will be serviced by a nationally recognized lending institution. However, our service does not stop after closing; we will always be available to answer questions or address issues as they arise. Having a contact on the inside is always beneficial, if you have a servicing related question and are not sure where to turn give Paramount a call – we’re happy to help.

St. Louis Mortgage Interest Rates –     November 17, 2010

For more information or if you have questions on mortgage rates you may contact me by phone at my direct line, (314) 372-4319, email at rfishel@paramountmortgage.com or you can visit our company website at http://www.paramountmortgage.com.

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