Cathy Lamb - Crye-Leike REALTORS - NLR Branch 501-975-2100

This information is provided by Jeff Smith of Cornerstone Mortgage Center.

Cornerstone Mortgage Center
Structured On Integrity
(501) 604-LOAN(5626) or Toll Free 1-877-372-5626

Understanding The Loan Process
Purchasing a home is the largest investment most people make in a lifetime. On average families only purchase 1 to 3 homes in all. As a result, buyers are unfamiliar with the mortgage lending process and are "scared" because of the financial and emotional significance of the
transaction.

Fortunately, the loan process has been simplified within recent years, and it does not have to be a painful experience. Understanding the loan process can ease your worries and help you set realistic expectations. The following information will prepare you for what awaits you as you purchase a home and obtain financing.

Pre-approval
    The first order of business is to meet with a loan officer and get pre-approved for a loan before you start your home search. A pre-approval means you are approved for specific loans subject to an underwriter reviewing the file after you find a home. The approval will provide information for
you on:
    1. estimated closing cost and monthly payments, and
    2. the maximum loan amount for which you qualify.

The only cost associated with a pre-approval is $55 for the credit report. To become pre-approved the mortgage company will need to take the loan application over the telephone. Usually this takes 10-20 minutes. Over 80% of our borrowers are pre-approved within 24-hours.

After your loan has been pre-approved, you and Cathy will be given a letter stating the specifics of the approval. This letter is a powerful bargaining tool when presented to the sellers, eliminating the seller's worries about your purchasing ability.

After You Find A Home
If you have not been pre-approved, you need to apply for the loan with a mortgage company immediately. The process should be similar to the pre-approval process.

Over the next 3-4 weeks your loan will be in "processing." It is now time to lock into an interest rate. Generally rates can't be locked in until there is a subject property address. During this time, the mortgage company will order the appraisal; expect a week to 10 days for the appraisal to be
completed.

After the appraisal is complete your file will be sent to an underwriter for review. Do not be alarmed if an underwriter requests additional documentation; it is common and not a sign that there are problems with your loan.

The title company will be researching the home to ensure that you will be purchasing it with a clear title. You will need to select a homeowner's insurance agent at least a week prior to closing, and notify the mortgage company and title company who the agent is. During the final week the
mortgage company and title company will be working together to prepare all your final documents for closing.

Final figures on funds needed to close will be available from the title company 24-48 hours prior to closing. You will need to contact your closing agent for these figures and obtain a cashier's check made payable to the title company. After closing, the title company will disperse funds to all parties involved, and the home will be yours!

Typical Paperwork Needed by the Mortgage Company

Non Self-employed Borrowers
*Most recent pay stub
*Two most recent bank statements for all asset accounts (entire statement, not just pg. 1)
*Past two years W2s
*Social security or disability award letters
*Lease agreements on all investment property
*Divorce decrees

Additional Items for Self-employed Borrowers
*Past 2 years Corporate and Personal tax returns
*Y.T.D. profit and loss statement and balance sheet

    Hopefully, you now have realistic idea of what to expect during the loan process, thus removing some of the fear involved with purchasing a home. It is best to get pre-approved and start the loan process before you find a property. Pre-approval will inform you of:

    1. what price home you can afford,
    2. what financing options are available to you, and
    3. estimates on closing costs and monthly payments.

After you have accepted the offer, the loan process will move smoother and quicker if you are pre-approved allowing you to focus on the monumental task of moving.

Call Jeff Today! If you would like to visit with a loan officer to discuss loans in more detail, please feel free to contact me at Cornerstone Mortgage Center at 604-LOAN (5626). I would love to answer your questions or get you pre-approved!

Jeff Smith
Loan Officer

Cathy Lamb · Crye-Leike REALTORS · 3499 John F. Kennedy · North Little Rock, AR 72116
Office: 501-975-2100 · Fax: 501-975-2101 · E-Mail: