Equifax

Finance Blog

Stay financially savvy with the Equifax Advisor.

Sign up for our FREE Monthly Email Newsletter

 

Thank you for signing up for the FREE Equifax monthly newsletter

In addition to keeping in the financial know, you may be interested in checking your credit score and report.

Understand your credit. Help protect your identity.

Equifax Complete™ Premier Plan

  • Know What May Influence Your Credit Score and Be Alerted of Changes
    Credit score monitoring with custom alerts
    Important Disclosure: The Equifax credit score and 3-Bureau credit scores are based on an Equifax credit score model and are not the same scores used by 3rd parties to assess your creditworthiness.¹
  • Help Protect Your Identity
    Automatic fraud alerts encourages lenders to take extra steps to verify your identity²
  • Lock Your Credit
    The ability to lock and unlock your Equifax Credit Report³
Save 75% your first 30 days with the purchase of Equifax Complete™ Premier

$4.95 for the first 30 days, then $19.95 per month thereafter. You may cancel at any time; however, we do not provide partial month refunds.4

¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.

²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.

³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.

4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.

Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.

What Do I Need to Apply for a Mortgage?

Written by Ilyce Glink on March 27, 2014 in Newsletter  |   No comments

In today’s real estate market, it takes more than a simple credit check to secure a mortgage. Be sure you understand the mortgage approval process—including what documents you’ll need to have ready—before you start shopping.

buying a homeLong gone are the days when securing a mortgage required a simple credit check. Since the housing market meltdown of 2008, the path to a mortgage has been lined with paperwork and red tape.

“Regulations have made the pendulum swing so far in the opposite direction that there’s an overemphasis on documentation and verification,” says Alex Margulis, a private mortgage advisor at PERL Mortgage, Inc., in Chicago.

And while mortgage lenders may be more adept at guiding homebuyers through what Margulis calls “the new normal,” it pays to understand the process—as well the paperwork you’ll need to gather—before you begin shopping for a house.

What documents do I need to provide for pre-qualification?

After you’ve budgeted for a home and tidied up your finances, it’s time to get pre-qualified by a reputable mortgage lender. For this simple (and usually free) process, you’ll need to provide a comprehensive snapshot of your finances, including:

  • Your debt
  • Your income and assets
  • Personal information, such as your date of birth and Social Security number

It’s a common misconception, but pre-qualification and pre-approval are two very different things. Many buyers believe that pre-qualification means they’re guaranteed a loan, says David Kutner, an independent senior loan advisor in Glendale, Calif. However, the real purpose of pre-qualification is to give you an idea of the amount of mortgage for which you might qualify. It certainly doesn’t carry the same weight as the comprehensive pre-approval process nor does it mean that your future as a homeowner is a sure thing.

(Read more: Buying a Home? 5 Things Every First-Time Homebuyer Must Do)

What documents will a lender need to pre-approve me for a loan?

Once you’ve been pre-qualified— a status that can help build your desirability for the seller—your next step is pre-approval. You may not have found a house to bid on yet, but without pre-approval your offer may not be accepted by the seller once you do find one. To get pre-approved, you’ll complete a mortgage application, and your file will undergo a more extensive review by an underwriter. It’s here that all of your paperwork comes in.

According to the Consumer Financial Protection Bureau, mortgage brokers should give you a list of what you’ll need for your mortgage application. It may include any of the following:

  • Social Security numbers or individual taxpayer identification numbers for all borrowers
  • Home addresses for at least the past two years
  • Current names, account numbers, and balances of checking, savings, money market, retirement, and credit card accounts
  • The address of your bank branch
  • Checking and savings account statements for the past three months
  • Your most recent pay stubs, W-2s, or other proof of employment and income verification
  • Federal income tax returns for the past two years
  • Evidence of any other income you receive (such as child support orders or Social Security award letters) if you wish to include this income for qualification
  • Balance sheets and tax returns if you are self-employed
  • Divorce settlement papers (if applicable)
  • Canceled checks for rent or utility bill payments to show payment history
  • Information on other consumer debts, such as credit cards, car loans, furniture loans, student loans, and department store credit cards
  • Gift letters, if you are using gifts from parents, relatives, or organizations to help cover the down payment or closing costs. Gift letters state that the money you received is a gift and will not have to be repaid.

After pre-approval, the lender can be specific about the mortgage amount for which you’ll be approved and also give you a more accurate interest rate. But while you’re definitely one step closer to obtaining a mortgage and becoming a more desirable candidate, the rates you’ve been quoted cannot be locked until you’re under contract with a seller, meaning you’ve found a home, put in an offer, negotiated, and have come to an agreement.

“Remember, all of these are ‘pre-,’ and that means pending a purchase contract and pending an appraisal that comes in with the value of your purchase contract,” Kutner says.

(Read more: The four mistakes first-time homebuyers need to avoid)

What will I need to make an offer on a house?

So what happens once you are pre-qualified and pre-approved and then have found a house on which to bid? Working with your real estate agent, use that pre-approval letter to beef up your offer. “If the seller confirms that there’s a contract, that’s when the buyer can start shopping for the lender in earnest,” Margulis says.

You’re under no obligation to work with the lender who pre-approved or pre-qualified you. You have the option to shop around for the best offer and compare factors such as rates, loan terms, lender-related fees, and third-party charges. The U.S. Department of Housing and Urban Development offers this mortgage shopping guide, plus a worksheet, to assist in the process.

While shopping for a mortgage, you may see unusually low rates advertised online or on TV. Take heed: Rates can change on a daily basis, and they can be locked for different time increments, typically 15, 30, 45, or 60 days. If an interest rate is significantly lower than others, be sure to ask what the lock period is, as well as the terms of the loan. Deceptive brokers may advertise a lower rate without mentioning it’s a 10-year loan.

With all of the homework you’ve already done preparing your finances and application materials, don’t drop the ball when selecting a mortgage lender. Rates aside, it’s important to work with someone who is licensed or registered and that you can trust. “I always recommend buyers meet their loan officer in person,” says Bryan Kelley, a senior mortgage consultant with WinTrust Mortgage in Chicago. “They need a qualified person who has their best interest in mind.”

Ilyce Glink is the author of over a dozen books, including the bestselling 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In! Her nationally syndicated column, “Real Estate Matters,” appears in newspapers from coast-to-coast, and her Expert Real Estate Tips YouTube channel has nearly 4 million views. She is the managing editor of the Equifax Finance Blog, publisher of ThinkGlink.com, and owner of digital communications agency Think Glink Media. In addition to her WSB radio show and WGN radio contributions, she is also a frequent guest on National Public Radio. Ilyce is a frequent contributor to Yahoo and CBS News.

No comments yet


Leave a Comment


Name :


Commenting guidelines

We welcome your interest and participation on this forum, but be aware that comments will be published at Equifax's sole discretion. Please don't use this blog to submit questions or concerns about your Equifax credit report or raise customer service issues. Instead, you should contact Equifax directly for all such matters and any attempts to do so in this forum will be promptly re-directed.

Some other factors to consider when commenting:
  1. Registration and privacy. While no registration is required to visit our forum, participants wishing to post a message must register by creating an account. All personal information provided by forum members incident to registration is governed by our Terms of Use and Privacy Policy.
  2. All comments are anonymous. We'll delete your name, e-mail address, and any other identifying information, including details about your investments.
  3. We can't post or respond to every comment - As much as we'd like to, we can't post every comment, nor can we guarantee that we will respond to each individual message. All questions or comments about your Equifax credit report or similar customer service issues should be handled by contacting Equifax directly.
  4. Don't offer specific legal, tax or financial advice. All of the materials on this Site are for information, education, and noncommercial purposes only and this forum is not intended as a means of expressing views or ideas regarding any specific legal, tax, or investment advice. While offering general rules of thumb is both permitted and encouraged, recommending specific ideas or strategies regarding investments, taxes, and related matters is prohibited.
  5. Credit Repair. This blog is not intended as a venue for the discussion or exchange of ideas regarding credit repair or other strategies intended to assist visitors and community members improve or otherwise modify their credit histories, ratings or scores.
  6. Stay on topic. Your comment should be concise and pertain to the specific post in question.
  7. Be respectful of the community. The use of profanity, offensive language, spam, and personal attacks will not be tolerated and egregious or repeat offenders will be banned from future participation. We encourage disagreement and healthy debate, but please refrain from personal attacks on our WordPresss and contributors.
  8. Finally: Participation in this forum may be terminated by Equifax immediately and without notice for failure to comply with any guidelines or Terms of Use. As such, you should familiarize yourself with all pertinent requirements prior to submitting any response through the blog or otherwise. All opinions expressed in this forum are solely those of the individual submitting the comment, and don't necessarily represent the views of Equifax or its management.

Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.