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Mortgage Loan Terminology

by Georgia FHA Mortgages

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Phone: 770-881-8266

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Georgia FHA Mortgages

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Mortgage Loan Terminology

by Georgia FHA Mortgages

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7 - 15 business days

9. Scheduling the Closing

8. Clear to Close

7. Conditions

Mortgage Loan Terminology

Explanation of The Mortgages Loan Process

1. Initial Consultation

15 - 30 minutes

2. Pre-Qualification

0 - 1 business day

3. Finding Programs and Rates

1 - 2 business days

4. The Application

1 - 2 business days

5. Title and Appraisal

3 - 5 business days

0 - 1 business day

at borrowers discretion

6. The Underwriting Process

1 - 2 business days

10. Total Estimated Time Frame

1. Initial Consultation

Before you start your mortgage loan process, you should first consult with a mortgage consultant. Why is this so important? First, the initial consultation is designed to help ensure that the mortgage loan consultant (loan officer) and the Borrower understand each other and are on the same page. In order to help you find the right mortgage loan for you, the mortgage consultant must know exactly what you’re trying to accomplish. Otherwise, you may end up with a mortgage loan that does not serve your best interest which may ultimately cost you thousands of dollars in unnecessary interest payments and/or prepayment penalties. Also, it is important that you, the borrower, understand what the mortgage consultant can and cannot do in regards to what you are trying to accomplish. “Georgia FHA Mortgages” uses the initial consultation to gather information from the borrower, which is critical in helping them develop your personal mortgage loan profile.

Typically, the mortgage loan consultant, who has access to the most Mortgage Loan Lenders and Mortgage Loan programs will stand a better chance at helping you find the right mortgage refinance loan than a mortgage loan consultant with limited resources. For example “Georgia FHA Mortgages” has access to a nationwide team of community based mortgage loan Lenders, which gives them the ability to help borrowers with Good Credit, Slow Credit…and everything in between.

2. Pre-Qualification

Pre-qualification starts the mortgage loan process. Once the mortgage consultant has gathered information about a borrower's income and debts, a determination can be made as to how much the borrower can pay for a home. Since different Mortgage Lenders offer different mortgage loan programs, it is in the borrower’s best interest to use a mortgage consultant who has access to as many different mortgage loan programs as possible. It is also in the borrower’s best interest to use Mortgage Loan Officers who have the ability to get pre-qualifications from a number of Mortgage Lenders without pulling their credit report more than one time.

As mentioned above, “Georgia FHA Mortgages” has access to a nationwide team of community based mortgage loan Lenders, which gives them the ability to help borrowers with Good Credit, Slow Credit…and everything in between. Also, their system allows them to get competitive mortgage loan rate quotes from multiple mortgage loan lenders without pulling your credit report more than one time!

In attempting to approve homebuyers for the type and amount of mortgage loan they want, mortgage loan lenders look at two key factors. The first factor is the borrower's ability to repay the mortgage loan and the second factor is the borrower's willingness to repay the mortgage loan.

The borrower’s ability to repay the mortgage loan is verified by their current employment and total income. Generally speaking, mortgage loan companies prefer for you to have been employed at the same place for at least two years, or at least be in the same line of work for a few years.

The borrower's willingness to repay the mortgage loan is determined by examining how the property will be used. For instance, will you be living there or just renting it out? Willingness is also closely related to how you have fulfilled previous financial commitments, thus the emphasis on the Credit Report and/or your mortgage rental payment history.

Mortgage banks (Lenders) lend money and set their rates based on the amount of RISK associated with each proposed mortgage loan deal. This RISK is determined by the way the mortgage loan proposal is structured.

The role of the Mortgage Loan Officer is to structure a mortgage loan proposal that:

1.)

satisfies as many of the mortgage loan borrower’s requirements as possible

2.)

satisfies ALL of the mortgage loan Lender’s requirements

It is important to note that in some instances, ALL of the mortgage loan borrower’s requirements cannot be met in order to comply with the mortgage loan lender’s requirements. For example, a borrower with bruised or slow credit may want 100% mortgage loan financing, however, the mortgage loan lender may only offer them a 90% or 95% mortgage loan to value, which means that if the mortgage borrower wants to do the deal, they will have to contribute the balance.

It is also important to remember that there are no rules carved in stone. Each applicant is handled on a case-by-case basis. So even if you come up a little short in one area, your stronger points could make up for the weaker ones. However, the mortgage loan officer MUST first be able to structure your mortgage loan in a way that caters to your strong points. Mortgage loan companies couldn't stay in business if they didn't generate mortgage loan business, so it's in everyone's best interest to see that you qualify. “Georgia FHA Mortgages” understand this basic principle; therefore, you can be confident that they will work hard to place you in a mortgage loan program that is customized especially for you.

3. Finding Mortgage Loan Programs and Rates

Shopping for a mortgage loan is very time consuming and frustrating. Mortgage loan lenders are constantly changing their mortgage loan programs and mortgage rates change sometimes several times a day! Many mortgage loan companies offer “free” mortgage quote rates to borrowers in an effort to help them shop. Although the intent is good, most often the borrower’s end up becoming more aggravated and frustrated because instead of getting “free" mortgage quotes, the borrower gets pounded with dozens upon dozens of phone calls and emails, day and night, from mortgage loan brokers and mortgage loan lenders trying to solicit for their mortgage business.

Georgia FHA Mortgages has solved this issue. Once you submit your mortgage loan request to them, ONE and only ONE of their mortgage loan professionals will contact you to create your mortgage loan profile based on your specific home mortgage requirements. They deal DIRECTLY with their NATIONWIDE TEAM of community based mortgage loan lenders so YOU WON’T be getting any ANNOYING PHONE CALLS. Their motto is:

Let Lenders hassle US for your mortgage loan business...NOT YOU!

No need to worry about excessive credit pulls. Their system allows us to get competitive home mortgage loan rate quotes from multiple mortgage loan lenders without pulling your credit report more than one time!

Once "Georgia FHA Mortgages" has identified the mortgage loan lender(s) with the best terms, you will be notified with the results so that you can make an informed decision without the hassle or pressure.

4. The Application

Once the mortgage loan borrower has decided on a mortgage loan program and mortgage loan rate, the mortgage loan officer will prepare the mortgage loan application and initial mortgage loan documents for signing. Upon signing the mortgage loan application and initial mortgage loan documents, the borrower must provide the remaining required documents needed for the mortgage loan. Your mortgage loan officer will have provided you with a list of these required documents. The initial mortgage loan documents will contain estimates of the various fees and closing costs associated with the mortgage loan. These mortgage costs and fees are verified by the Good Faith Estimate (GFE) and the Truth-In-Lending (TIL). These mortgage loan documents must be received within three days of submission of the mortgage loan application to the mortgage loan lender. It is important to remember that these costs and fees are only estimates. In a properly structured mortgage loan, these amounts will often represent worst case scenarios and tend to be less at closing.

5. Appraisal and Title

Once the mortgage loan officer receives the signed mortgage loan application and the required documents, they will order the appraisal and title. At this stage in the process, many mortgage loan officers will go ahead and submit your mortgage loan package to the lender for review and underwriting. This practice causes inefficiency for the mortgage loan lender; therefore, many mortgage loan lenders will hold the file or give it a "low priority" until they receive the “full” mortgage loan package. They also develop a tendency to show favor or “higher” priority to mortgage loan officers who always deliver “full” mortgage loan packages versus those who consistently send in “incomplete” mortgage loan packages. The mortgage loan professionals at "Georgia FHA Mortgages" consistently receive “high” priority with mortgage loan lenders because they ALWAYS deliver “full” and “clean” mortgage loan packages to them.

6. The Underwriting Process

Once a “full” mortgage loan package has been assembled, the mortgage loan officer submits the package to the mortgage loan lender’s underwriting department for review and decision. The underwriter is responsible for determining whether the mortgage loan package is deemed an acceptable mortgage loan or not. If the mortgage loan is approved, but more information is needed, then the mortgage loan underwriter will issue an approval with “conditions”.

7. Conditions

Conditions (sometimes called “Stips” or Stipulations) consist of additional information needed by the mortgage loan lender’s underwriting department in order to satisfy ALL of the mortgage loan lender’s requirements. Sometimes the conditions may be as simple as an additional signature or current bank statement. Other times, conditions may consist of providing proof that a debt or lien has been satisfied or verifying that the current month’s mortgage loan has been paid. Once ALL of the mortgage loan lender’s conditions have been satisfied, the mortgage loan underwriter will issue a “Clear to Close” to the mortgage loan officer.

8. Clear To Close

The Clear to Close is a document issued by the mortgage loan lender’s underwriting department which gives the mortgage loan borrower and the closing agent permission to close the deal. It is EXTREMELY important to understand that regardless of when the mortgage loan borrower, the seller, and/or the realtor wants to close the deal, the mortgage loan lender via its underwriting department UTIMATELY decides when the deal will close via the “Clear to Close”. Because of this, the mortgage loan borrower should be advised that he/she SHOULD NOT make any definitive plans regarding closing the mortgageloan deal until the "Clear to Close" has been issued by the mortgage loan lender. Many times, especially on purchase mortgage loan deals, the realtor, the seller, and the buyer will set a closing date for a mortgage loan deal well before the “Clear to Close” has been issued by the mortgage loan lender. Quite often, they will coordinate the closing even before the Mortgage Loan Company or mortgage loan officer have been chosen. Unfortunately, more times than not, the end result is not a pleasant one.

For example, a new home buyer coordinates with the seller and realtor to close the mortgage loan deal at the end of the month. Based on this arrangement, the mortgage loan borrower issues a notice to vacate his/her apartment for the end of the month, schedule time off from work, and hires movers to handle the move. The mortgage loan application gets delayed in underwriting because some unforeseen conditions were issued by the mortgage loan lender. These conditions cannot be satisfied by the end of the month. The mortgage loan borrower is faced with no place to live, movers on the clock, a wasted day off work, and a very unhappy seller who is threatening to void the contract and sell the home to another interested buyer.

9. Schedule the Closing

The mortgage loan lender will issue the mortgage loan officer the “Clear to Close”. The mortgage loan officer will then notify the borrower so that they can coordinate a closing date and time. Then the mortgage loan officer contacts the closing agent to request the borrower’s closing date and time. Once the closing agent confirms the closing date and time, the mortgage loan officer will notify the realtor and/or seller of the closing date and time.

"Georgia FHA Mortgages" will also request preliminary mortgage closing documents from the closing agent prior to the closing. The mortgage loan program specifics, mortgage interest rate, closing costs and fees are all reviewed for accuracy. Any adjustments or corrections are requested and the mortgage loan documents are reviewed again. Once the mortgage loan officer confirms the accuracy of the mortgage loan documents, they contact the borrower and review the mortgage loan documents with them. This process helps to ensure that the borrower is aware of and is satisfied with the final mortgage loan numbers prior to closing, which ultimately speeds up the mortgage loan closing process.

10. Total Estimated Time Frame

Please note that the Total Estimated Time Frame is only an estimate. The actual mortgage loan process may vary based on several factors. For example, a mortgage loan borrower who is well organized and responds to information requests from the mortgage loan officer quickly will help speed up the mortgage loan process versus a borrower who does not respond quickly. Also, the mortgage loan lenders underwriting times, the title and appraisal process, as well as, the closing agents booking schedule will vary depending on their respective work loads, which may be more or less than the estimated time frames indicated above.

Mortgage Loan Terminology

Explanation of The Mortgage Loan Process

Current Closing Times: 7 - 10 Business Days

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