As a trusted personal finance writer and mortgage specialist, Maryalene LaPonsie has interviewed hundreds of certified financial planners, CPAs and wealth advisors, and distills their expertise into accessible articles on topics ranging from retireme.
Maryalene LaPonsie Mortgages ExpertAs a trusted personal finance writer and mortgage specialist, Maryalene LaPonsie has interviewed hundreds of certified financial planners, CPAs and wealth advisors, and distills their expertise into accessible articles on topics ranging from retireme.
Written By Maryalene LaPonsie Mortgages ExpertAs a trusted personal finance writer and mortgage specialist, Maryalene LaPonsie has interviewed hundreds of certified financial planners, CPAs and wealth advisors, and distills their expertise into accessible articles on topics ranging from retireme.
Maryalene LaPonsie Mortgages ExpertAs a trusted personal finance writer and mortgage specialist, Maryalene LaPonsie has interviewed hundreds of certified financial planners, CPAs and wealth advisors, and distills their expertise into accessible articles on topics ranging from retireme.
Mortgages Expert Chris Jennings Loans & Mortgages EditorChris Jennings is a writer and editor with more than seven years of experience in the personal finance and mortgage space. He enjoys simplifying complex mortgage topics for first-time homebuyers and homeowners alike. His work has been featured in a n.
Chris Jennings Loans & Mortgages EditorChris Jennings is a writer and editor with more than seven years of experience in the personal finance and mortgage space. He enjoys simplifying complex mortgage topics for first-time homebuyers and homeowners alike. His work has been featured in a n.
Chris Jennings Loans & Mortgages EditorChris Jennings is a writer and editor with more than seven years of experience in the personal finance and mortgage space. He enjoys simplifying complex mortgage topics for first-time homebuyers and homeowners alike. His work has been featured in a n.
Chris Jennings Loans & Mortgages EditorChris Jennings is a writer and editor with more than seven years of experience in the personal finance and mortgage space. He enjoys simplifying complex mortgage topics for first-time homebuyers and homeowners alike. His work has been featured in a n.
| Loans & Mortgages Editor
Updated: Aug 9, 2023, 12:39pm
Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.
Getty
The mortgage application process can be lengthy. When filling out your application, you’ll need to provide a handful of personal and financial information—plus the documents to support it. Understanding what goes into a mortgage application can help speed up the process.
A mortgage application is your request to a lender to borrow money for the purpose of buying a property.
Since a home is a large purchase, the mortgage application process is usually extensive and requires information about you and your financial situation. As part of the application, you may be required to provide a variety of documents that prove your income, employment and assets.
While every lender may have their own borrower requirements, many use a standardized application form: the Uniform Residential Loan Application. Most lenders also request similar documentation from applicants.
Before applying, gather the following information to ensure the process goes as smoothly and quickly as possible.
A mortgage lender needs to confirm your identity. Be ready with government-issued identification and your Social Security number. The lender uses your Social Security number to review your credit history and determine if you’re eligible for a loan. If you have a co-borrower, they’ll need to provide identification information as well.
On the mortgage application, you’ll also need to indicate your:
You’ll be asked to provide information about your employment and income on the mortgage application but be prepared to back up those numbers with documentation. A lender may request some or all of the following:
You’ll also need to provide the name of your employer, its address and phone number, your position and start date, and your monthly income.
If you receive alimony, child support, disability benefits, unemployment, VA compensation or other forms of income, you may need to provide benefit statement letters or similar supporting documents.
On the mortgage application, you’ll need to provide information about your assets and debts. Your assets generally include bank accounts, investments, retirement accounts, cash value life insurance, business equity and real estate.
For assets, you’ll need to include the name of the financial institution, your account number and cash or market value. For liabilities, the standard mortgage application asks for account numbers, unpaid balances and monthly payment amounts.
To confirm the information you provide, lenders may ask for the following documents:
If you own real estate, you’ll need to provide the property value, status and monthly payments. If it’s an investment property, a mortgage lender will also want to know the property expenses and your monthly rental income.
Depending on your circumstances, you may be asked to provide additional information as part of your mortgage application. For instance, you may be asked for a business plan if the mortgage is to purchase an investment property. Or a gift letter may be needed if your down payment is being paid by anyone else.
At the end of the mortgage application, there is a declarations section in which you’ll need to answer a series of questions, such as whether you plan to live in the home or if you’re party to a lawsuit.
There’s also a section for acknowledgements and agreements, which outlines your legal obligations as part of the contract. If you agree to the terms, this is where you sign and date the application.
In addition to providing the required information, your lender will also require that you submit extensive documentation to back up the numbers. It’s helpful to gather as much as this paperwork as possible before submitting your application.
Assuming you have gathered all the necessary information in advance, you should be able to complete a mortgage application in less than an hour. Some lenders have representatives who can assist with the process.
However, submitting an application is only the first part of the approval process. Lenders may request additional information and they need time to review all the material submitted.
Once you submit your loan application, your lender will provide you with a loan estimate within three business days. This is a document that outlines important details about the loan offer, including the interest rate, term length, monthly payment amount, escrow details and closing costs. You should review this document in detail, and either accept the offer or negotiate it if you feel there are certain costs or terms that should be changed.
Once you officially accept your loan offer, the lender will begin underwriting the loan. This means that someone will review the details of your application, pull your credit reports, order a home appraisal and make the final call on whether you’re approved.
During this time, it’s important to avoid making any changes to your financial or credit situation. Don’t apply for any credit, cosign a loan, move large sums of money, change employers or do anything else that could raise a red flag as your application is being reviewed.
Once your application is officially approved, all that’s left is to close on your loan. You can expect the overall process to take between 30-45 days from the time you submit your application to closing day.
Personal finance writer Casey Bond contributed to this article.
Since the mortgage application process requires a fair amount of effort, you may be hesitant to go through it more than once. However, the Consumer Financial Protection Bureau suggests contacting at least three lenders before taking out a loan to find the one that best fits your needs and offers the best rates.
Mortgage application fees vary widely so be sure to ask a lender about this cost in advance. While some lenders don’t have application fees, others will charge as much as $500. In some cases, you may be able to roll this fee into your loan if approved.
Before applying for a mortgage, pay down debt, especially high-interest credit card debt. Having lower credit card balances could improve your credit score and your debt-to-income (DTI) ratio—two factors that help increase the chances of being approved for a mortgage and receiving a more favorable interest rate.
It depends on the lender. Once your application has been reviewed and you’ve received preapproval, you may have 30, 60 or 90 days to find a property to purchase.
There is no limit to how many times you can apply for a mortgage. Submitting multiple applications means multiple hard inquiries on your credit report, which can temporarily drop your score. If you’ve been denied because of poor credit, it might be best to wait and try to boost your score before applying again.