Loan Pre-Approval Process - How to be Prepared

MonicaHeader My cousin in Naples, Italy recently asked me how the housing market was in the Bay Area.  I didn’t know where to begin and whether I wanted to reveal to her such a foreign anxious world that I lived in.  I decided to avoid the question entirely and just take in the peaceful stories of my cousins and their lives…But her question made me think about how important it is, to keep stress at a minimum.  Please read further, especially if you are contemplating purchasing a home in the Bay Area…

As we enter into the final month of the first quarter of 2015, one piece of advice I would give future homebuyers, is to be REALLY prepared.  When you purchase a home, you are first purchasing a loan.  Before a buyer calls a bank or a Loan Advisor, that buyer should be completely prepared.  If you want to purchase a home in America, you must have ready and accessible documentation.  And that documentation must be clear without any ambiguities.   Here is a checklist that just may make homebuyers stand out, when it comes to writing offers:

  1. Letters of Explanation:  If you have a job gap, explain.  If you have large deposits that are not from work or transfers from other accounts, be prepared to explain and provide a copy of that deposit.  You will need to explain recent credit inquiries, addresses that show up on your credit report.  If there are other issues that stand out, explain them on separate letters.  Did your income change?
  2. Pay stubs for a full 30 days, W2s for the most recent 2 years, and full Federal Tax Returns.  If you are self-employed, you will need to provide Profit & Loss Statement YTD.
  3. 2 months of all of your Asset Statements.  You will need to provide all pages, not missing one page.
  4. If you own other properties, you will need to provide a recent mortgage statement, insurance declarations page, property tax bill and proof of what your HOA Dues are, if it is a condo.
  5. If you rent,  you will need to provide 12 months of rental checks that have been cleared at your bank, to show you have paid on time. Both front and back will be required.
  6. You will need to provide a 2 year history of your employment.  This means be ready to provide a start date of your current employment, address, and HR phone number.  Also, if you just started a new job, you will need to provide the old employment’s address, name of company, start and end date, and HR Phone number.  A full two year history is required, and verbal phone calls are made to all employers within that two year history.
  7. Any gift money must be accounted for by having a gift letter completed.  The gift money can be wired directly to an escrow company when you are in contract.  This is the easiest way to proceed when you have gift money.  If the money is directly wired into escrow from the giftor, it will make your process smoother.

If you have all this information ready and copied, you will breeze through the pre-approval process and be able to make very strong offers! If you have any questions, please call me anytime.  I am Monica C. Di Perna, 415-710-0354, NMLS 116494 at RPM Mortgage, Inc! .


Monica C. Di Perna, NMLS#116494

Loan Advisor

RPM MORTGAGE, INC. Berkeley Branch 1385 Shattuck Ave Suite B, Berkeley, CA 94709

Cell 415-710-0354 Fax  844.864.3269

Can DoWill Do.

RPM Mortgage, Inc- NMLS 9472-Licensed by the Department of Business Oversight under the Residential Mortgage Lending Act. Equal Housing Opportunity.