Which comes first? Looking at new homes or contacting Tracey?
Ideally, you will always contact Tracey first. It's important to get your loan pre-approval done so you know the price range that works best for you. Pre-approval can lend additional strength to an offer that you make on a home. Call her. You can make an appointment to go into the office, or your entire pre-approval can be done by email, fax, and phone.
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What will Tracey need for pre-approval?
*Most recent paystubs or letter of hire for new job
*Last two years W-2's
*Last two years tax returns if self-employed or receiving commission income
*Documents to verify other types of income ie, child support, social security, pension, etc.
*Copy of bankruptcy including all schedules and discharge (if applicable)
*Copy of divorce decree (if applicable)
*Last two months bank statements
*Most recent statement on any retirement/investment accounts
*Drivers license and social security card or military ID
*Active duty military transferring to Utah as their new duty station will need a copy of their orders
Note: If you have good credit and a large downpayment (20%+) you may need less documentation than listed above. Call Tracey or apply online, and she can run your loan through an Automated Underwriting program to give you the exact requirements and save you from searching for documents you don't need.
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What are steps to the loan process?
*Get pre-approved
*Choose a Realtor to help you find a home
*Make an offer (Real Estate Purchase Contract)
*Get a copy of the purchase contract to Tracey if offer is accepted
*Discuss interest rates with her and consider "locking in" a rate
*Order your professional home inspection immediately (if you plan on having one done). Contact Tracey when the inspection is complete with your decision on continuing with the transaction. (Offers are typically contingent upon the home inspection findings)
*Tracey will order the appraisal and flood certification. If the home is in a flood zone, you will be required to apply for flood insurance if you decide to continue with the transaction.
*Decide on a homeowner's insurance agent and tell Tracey. Home Loan requires insurance, but has no say regarding the source of that coverage. Get quotes from several sources. You will find that it's usually less expensive to insure your home and your cars with the same company. We need insurance information 7 business days before you close.
*When the appraisal is received, Tracey will notify you and put the loan in for final underwriting.
*Do a final "walk-through" of the home before closing.
*Close on the loan at the title company.
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Who pays for my Realtor?
The seller. When a seller lists a home with a Realtor he expects to pay a fee, usually 6% of the sales price. This fee will either go to his listing agent or it will be split between the listing agent and the buyer's agent that represents you.
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What if I am interested in a For Sale By Owner?
Purchasing a For Sale By Owner (FSBO) property, without the use of a Realtor to represent you, will require extra work on your part. You will have to negotiate directly with the seller, execute all contracts, and choose a title company without the market knowledge that a Realtor has to offer. Some FSBO's will agree to pay your Realtor and you can have the advantage of representation. Please note: Tracey cannot help you with any real estate matters, outside of the loan, as she is not a licensed Real Estate Agent.
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What is a title company?
The title company issues title insurance on the transaction, handles all of the funds involved in the transaction, and all of the recordings that take place at the county courthouse to document your ownership and new loan. The title policy guarantees you that the title company used the funds to clear all of the liens against the property before they gave any remaining proceeds to the seller. The choice of title company is yours, however, if you have no preference, your Realtor can help direct you.
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How long does it take to process my loan?
From the time you give Tracey a copy of the purchase contract, it usually takes 2-3 weeks to be ready to close. In some situations, that time frame can be shortened.
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What does my payment cover?
Principal, interest, taxes, insurance, and mortgage insurance (if applicable). This is referred to as PITI. Your taxes and insurance will be paid each year by your loan servicer when they come due. If you have a down payment of 20% or more, you can pay your taxes and insurance on your own and they won't be included in your payment.
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Can my monthly payment change?
If you have a fixed rate loan, your payment would only change if your taxes or insurance change. If you have an adjustable rate mortgage, then you will be subject to interest rate changes as well throughout the loan.
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What if interest rates drop while my loan is being processed? Am I stuck?
Not always. On fixed rate first and second mortgages, SWBC will allow a one-time re-lock, if rates improve at least .25%. This does not apply to Utah Housing loans, adjustable rate loans, or other specialty products. Tracey will notify you if this opportunity becomes available. Once the loan closes, the rate cannot be changed.
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Will SWBC sell my loan?
Yes. SWBC processes and funds your loan in their local office. They will then transfer your loan to a loan servicer after closing ie, Utah Housing, Chase, Suntrust, etc. You may make your first payment or two to SWBC, but you will eventually transfer to the new servicer. You will get documentation from SWBC and the new servicer when the transition is to take place. The terms of your loan can never change when a loan is sold.
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When do I get the keys?
It depends. When you close on a home, the loan is typically funded the next day. The title company records the warranty and trust deeds at that time, and you now own the home. Actual possession takes place according to the purchase contract, so consult with your Realtor to make sure you understand this part of the agreement.
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Can I qualify?
Click on Tracey's "Can I Qualify" page to review some guidelines for different loan types.
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