The Not-So-Sexy Mortgage Application

 

It turns out there is nothing sexy about filling out the mortgage application. Why do I say that? Well, no matter how many times I wracked my brain to come up with a catchy or interesting way to start this conversation, you guessed it, I came up blank. I imagine it may have something to do with the fact that nobody likes filling out applications, especially long ones with lots and lots of blank spaces that need to filled in. Nevertheless, you can’t get approved for a mortgage without filling one out so let’s dive right on in and do a quick sketch of the things you need to know.  

Where do you go to fill out an application? Back in the pre-digital age you would fill out an actual physical paper mortgage application also known as the 1003 (pronounced ten-oh-three). Today the big push is to completely digitize the entire mortgage application process. What this means is that making a trip down to see your banker/loan officer in his/her office is no longer necessary. The entire application can be filled out online via your phone, tablet, or home computer. Your loan officer will most likely send you a link to the application via email or give you verbal instructions where to go on their website to get started. You will most likely be asked to create a username and password to a secure portal, so your personal information is protected. Before we get into the details of the mortgage application a quick note about the mortgage application (1003) is needed.

All applications are the same. The mortgage application you fill out to apply for a home loan is the same everywhere you go. This is because Fannie Mae and Freddie Mac have created a standardized form for industry. This makes the approval process more convenient for everyone. The use of the term “1003” is the name Fannie Mae originally came up with for their application. Freddie Mac calls their application Form 65. Because Fannie Mae came up with their application first the entire industry just refers to both applications as “the 1003”. This means when you call up a mortgage company to start the application process you can simply tell the loan officer that you are interested in applying for a mortgage and would like to fill out the 1003.

There are a lot of pages!  The application is quite lengthy, 9 pages to be precise, and has A LOT of spaces/boxes to fill in. You didn’t think the bank is going to just give you hundreds of thousands of dollars without making you jump through a few hoops, did you? Does that mean that everything must be filled out completely and perfectly to qualify? The good news is the answer is, no.

I could go into a very long explanation about what is on the 1003 and which items you are required to fill out and which ones you are not. It is enough to say that you should fill it out as completely as possible. Most online application pages will prompt you to fill out the areas that are required and will not let you continue to the next page/section until you have done so. If there is an area on the 1003 you don’t understand or are not sure how to fill it out just leave it blank and ask you loan officer about it later. As a rule, the more information you can give the loan officer the better, it also reduces the chances her/she will need to contact you later for additional required information. I promise you, if you miss something on the application that is needed your LO will contact you for the missing information. That does not mean you should just skim through application only filling out those areas you are required to move on to the next section, do your best to be thorough. Doing so will expedite the application process.

What information will the application ask for?

1. Personal Information – In addition to things like your current address (Last two years are required) and how long you have lived there you will be asked for your social security number and date of birth.
2. Employment Information – You will need to put in a 2-year work history and what your gross monthly income is.
3. Financial Information – this will include both your assets and liabilities.
4. Property You Own – If you own other property you will need to include the property(ies) details such as address(s) and whether or not there is a mortgage(s) attached to it.
5. Demographic Information – Race and Gender
6. Declarations – You will be asked for details about the property you plan to buy, the money you are using for a down payment to purchase the home, and additional information about your finances.
7. Military Service – If you are applying for a VA loan there is a section you will fill out related to your service in the military.
8. Signature – As you might expect, at the end of the application you will sign that the information you have provided is true. This of course means, don’t lie. Lying on the 1003 could mean jail time. Your loan officer is not going to take your word for it anyway and will be verifying the information you provide, so be as truthful as possible.

 And that is it, the mortgage application is filled out and you are ready to move to the next step, sending your loan officer proof of the information you provided on the application. Your loan officer will now start the pre-approval process by pulling your credit, examining your finances in greater detail, and comparing it all to the financial documents you provide.

If there are any questions you have that I did not answer regarding the 1003 please don’t hesitate to reach out. If you want to start the application process you can access the 1003 here, HanksHomeLoans.com.

Benjamin Hanks

NMLS# 1855439

Cell: 404-955-1253

Email: bhanks@mortgageright.com