What information does a Mortgage broker need from me?
I found some interesting questions and answers on an affiliate's web page, and I'll reprint some of them here with my own explanations added. The first one is;
What Information Will a Mortgage Broker Need From Me? OR
What questions will a Broker ask somebody who’s looking for a Mortgage?
There are three main things you will be required to provide:
i. Verification of Income
ii. How much and where the Down Payment is coming from
iii. Personal information for Credit Checks (Birthday, Social Security Number, Address, Job Letters, Pay Stubs, 3 years worth of Tax Returns, 3 months worth of Bank Statements, any current Retirement Savings Funds…)
Your Banker or Broker will want to confirm your ability to qualify by doing a GDS Ratio (Gross Debt Ratio) and a TDS Ratio (Total Debt Ratio).
A Gross Debt Ratio is determined by taking the Mortgage Payment, the Property Taxes, and a Heat Component (really hot areas will be exempt from this, I’m guessing!), which is usually around $50.00. These numbers are added together. That number is multiplied by 12, then divided by your Gross Income Amount. This number can’t exceed 32% of your Gross Income. Some banks &/or brokers may have different criteria, but this is a commonly used method to see if a client can qualify for a mortgage.
The Total Debt Ratio takes the above information (the GDS Ratio) along with all other debts and payments (whatever else you have to pay per month – credit cards, support payments, etc.) to make sure that the Grand Total of all of your payments, including the new mortgage and taxes, won’t exceed 40% of your Gross Income.
N.B. Don’t get too hung up on the math – that’s the job of the banker or broker. This is just info to give you a good understanding of how they get their numbers.
Well, that's pretty simple, and for a lot of lenders those are the requirements. But don't get bent out of shape if you see one or two things on this list that you can't get or meet. For instance, 3 years of tax returns are usually only required for top credit loans and self employed borrowers (and some lenders will take 2 years for self-employed!)
An experienced, competent broker will have many sources, Star Mortgage has access to over 700, each with their own programs and qualifications! Some of these are called "stated income programs", and you basically tell the lender what you make...and they don't verify it! Now obviously it has to be within reason, someone working 30 hours a week at a convenience store can't claim $100,000 a year salary, but someone with a nurse's license working part time on-call probably could.
Give Star Mortgage a call at 813-882-8878, or visit their website by clicking on the name. They have a mini-application you can fill out on line, and they'll get back to you to discuss what you need, then they'll help you get it!
Mr Mortgage
What Information Will a Mortgage Broker Need From Me? OR
What questions will a Broker ask somebody who’s looking for a Mortgage?
There are three main things you will be required to provide:
i. Verification of Income
ii. How much and where the Down Payment is coming from
iii. Personal information for Credit Checks (Birthday, Social Security Number, Address, Job Letters, Pay Stubs, 3 years worth of Tax Returns, 3 months worth of Bank Statements, any current Retirement Savings Funds…)
Your Banker or Broker will want to confirm your ability to qualify by doing a GDS Ratio (Gross Debt Ratio) and a TDS Ratio (Total Debt Ratio).
A Gross Debt Ratio is determined by taking the Mortgage Payment, the Property Taxes, and a Heat Component (really hot areas will be exempt from this, I’m guessing!), which is usually around $50.00. These numbers are added together. That number is multiplied by 12, then divided by your Gross Income Amount. This number can’t exceed 32% of your Gross Income. Some banks &/or brokers may have different criteria, but this is a commonly used method to see if a client can qualify for a mortgage.
The Total Debt Ratio takes the above information (the GDS Ratio) along with all other debts and payments (whatever else you have to pay per month – credit cards, support payments, etc.) to make sure that the Grand Total of all of your payments, including the new mortgage and taxes, won’t exceed 40% of your Gross Income.
N.B. Don’t get too hung up on the math – that’s the job of the banker or broker. This is just info to give you a good understanding of how they get their numbers.
Well, that's pretty simple, and for a lot of lenders those are the requirements. But don't get bent out of shape if you see one or two things on this list that you can't get or meet. For instance, 3 years of tax returns are usually only required for top credit loans and self employed borrowers (and some lenders will take 2 years for self-employed!)
An experienced, competent broker will have many sources, Star Mortgage has access to over 700, each with their own programs and qualifications! Some of these are called "stated income programs", and you basically tell the lender what you make...and they don't verify it! Now obviously it has to be within reason, someone working 30 hours a week at a convenience store can't claim $100,000 a year salary, but someone with a nurse's license working part time on-call probably could.
Give Star Mortgage a call at 813-882-8878, or visit their website by clicking on the name. They have a mini-application you can fill out on line, and they'll get back to you to discuss what you need, then they'll help you get it!
Mr Mortgage
posted by Jack @ Tuesday, November 15, 2005
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