US Mortgage - Approval Process

We believe that everyone should have the opportunity to rise
to their highest level of achievement through home-ownership

The Approval Process FAQ's

Q: What happens to your loan application once it is given to US Mortgage?
Q: What are the major factors that are reviewed at when we as your lender are
     determining how much of a loan you can afford?
Q: Why does the process appear to be so complicated to so many applicants?

A: When you submit your application to US Mortgage for a mortgage loan, we are actually
    doing the following in order to grant a credit decision on your loan application:

• Verifying your amount of your income and the stability of your employment
• Verifying the amount of other debts you currently have
• Determining the affordability of your new mortgage payment
• Verifying the source of your down payment
• Analyzing your past credit history
• Determining the property's value

Income and Employment

You will be asked to provide US Mortgage with proof of your current gross income. Typically, this will require that you bring in a copy of your most recent pay stub and a copy of your most recent W-2 Statement. Your pay stub will verify that you are currently employed and will indicate the approximate amount of income that you are currently earning. Your W-2 statement will indicate that you have been gainfully employed for at least the past year and it will indicate the average income you have earned on a yearly basis.

If you derive a 25% or more source of your income from commissions, overtime and/or bonuses, we will require that you bring in W-2 statements for the past two years and will take an average of your income for the most recent two years as the qualifying income on your application.

If you are self-employed, you will be asked to provide US Mortgage with your most recent W-2 statements ( if applicable ), your corporate tax returns and your most recent financial statements. We will typically use a two-year average of income for self-employed individuals.

When analyzing income, we look to how much you earn and also attempt to confirm that you have had stable employment for at least the past two years, whether or not employment has been with the same employer during this required two year period. Although our guidelines generally require two years of stable employment, your situation may be such that employment of less than 2 years would be acceptable.

Verify all debts

You will be asked to list all of your current debts on your mortgage application. Your credit report will also list all of your current debts. These debts will calculated to ensure that you will not be overextended debt wise once the new mortgage payment is included in total debt.

Verifying your source of Down Payment

At US Mortgage, you can purchase a property with as little as 1-3% down payment. Your down payment cannot be an unsecured borrowing. Examples of acceptable forms of down payment include cash in a bank account, mutual funds, stocks, proceeds from the sale of another property, IRA/401K or gift from an immediate relative.

When you come in for your application you will be asked to bring in copies of your most recent bank statements or account records in order to verify that the down payment funds are available. The statements must indicate that the funds have been in the account or another acceptable form of account for at least 3 months.

Analyzing your credit

Once you have made application with US Mortgage, the ordering of a credit report is one of the initial steps taken. If you are married, and your spouse is also applying on the loan application, a joint credit report will be ordered. In a joint credit report, any accounts held individually by each spouse will be reported in separate individual account records, while credit held jointly will be reported as a joint record.

When analyzing credit, particular attention is paid to the most recent 24-month period. More weight will be placed on recent derogatory credit, especially late payments on either existing mortgage or installment loan debt. Past bankruptcies must have been discharged for at least two years. If you have had a past bankruptcy, you should be prepared to document the reasons for the bankruptcy and also be able to provide discharge papers. You must have re-established excellent credit for the most recent 24-month period.

In addition to past credit history, Lenders have been paying particular attention to the credit score assigned to your credit record. Credit scores are snapshots that objectively assess your credit history and current usage at a given point in time. Each credit score is a reflection of the unique collection of data on your credit file. The credit score measures the relative degree of risk that your credit profile presents to US Mortgage.

Determining the property's value

Since the only collateral for the mortgage loan is the property itself, it is very important that the value of the property is determined during the approval process, an appraiser is an individual who is licensed to inspect the property and compare property values in the neighborhood in order to determine the value of the property. This process is referred to as appraising the property.

When purchasing a property, you should be aware of the values of the homes in the immediate neighborhood. Much of the property's value is based not only on its condition, but also on the properties selling in the neighborhood within the past 6 months. Beware of properties selling at a purchase price extremely higher than neighboring properties. This could create a problem when determining the actual appraised value of the property, as such a property may be considered its appraised value may not be in line with the sales price.