Heres a video listing the DO and DONT steps to follow in the process of getting a mortgage loan. To ensure you wont fall victim to loan fraud, make sure you follow all of these steps in the process of applying for a loan. DO: Be honest about residency; if youre not going to live in the house, say so. Be clear and honest about any questions related to your credit history. Report your finances — debt, income and everything else — accurately. Do NOT: List fake co-borrowers Change tax return figures Overstate assets or valuations Fudge employment records Provide incorrect files to answer questions Exaggerate income or investments Buy property for someone else. Of course, do not sign ANY blank documents, and be sure you have read and understood anything that you do sign. And DO keep your own records of everything.

How do you apply for a mortgage? First, assemble this information: Tax returns and bank statements for the past 2 years. W-2 forms for the past 2 years Pay stubs for the past 3 months Documentation of any long-term debts Proof of any non-payroll income When youre far enough in shopping for a home to make an offer, add these things: Address and description of the property A sales contract on the home Identify lenders and submit a loan application. If your credit is frozen, be prepared to unfreeze it for the credit history and credit-rating reports the lender will order. The lender will order an appraisal and (in some cases) possibly an inspection. Expect additional questions and clarifications as they go through the process of evaluating your ability to repay the loan. The process usually takes more than a week, and delays of up to 6 weeks arent uncommon. Be patient, and keep copies of everything.

Many people have been through this decision in the past few years. Its pretty simple; if interest rates drop significantly below the rate of an existing mortgage, refinancing may make sense. Advice from HUD (US Dept of Housing & Urban Development) experts is "2% and 18 months." If you plan to remain in the home for at least a year and a half, and if you can qualify for a rate thats 2% lower than your current rate, refinancing is worth a look. Keep in mind that refinancing is not free. The refi process involves many of the same inquiries, validation and fees as the original financing. "Rolling the costs into the new loan" can mask the long-term financial impact. Compare the math carefully.

You may run across the terms "production builder" and "custom builder." They sound complicated, but its pretty simple. Think about buying a dress or a suit. You can buy one "off the rack", or have a tailor measure and make for you. Production builders create a "rack" of homes; custom builders measure lots, learn buyer preferences, and make highly customized homes. Which you select depends on your budget and preferences: How much time do you have? Do you own a lot on which to build? How much design input would you like? Production builders frequently build multiple homes on multiple lots in the same place, so they generally combine the home and the lot in a package deal. If you already own a lot, a spot lot builder who constructs an off-the-rack model from plans on your lot, may be your only alternative to a custom builder. As with suits or dresses, quality and price vary for both production and custom builds. Take the time to evaluate both carefully in your local market.

The interest rate on a mortgage has a large impact on payments and costs. Available rates change all the time, based on government policies, financial conditions and more. In the weeks-to-months required for a home purchase, rates could go up (or down). So most lenders offer mortgage customers options for a guaranteed rate — the common term is rate lock. The availability of rate locks, and the factors that are involved in a lock, also vary with market conditions. Of course, the buyers financial profile will affect availability as well: What is your credit score? How solid is your credit history? What is the LTV ratio of the offer on the property? Where is the property located? Rate locks are usually available for: An accepted offer, on a specific property, For a given combination of interest rate and points, For a set period of time, Whether market rates go UP or DOWN. The last point is key. Accepting a rate lock could mean slightly higher-than-market costs if rates go down after you have locked. At some point in the home-buying process, you may be offered the option of a rate lock. Are mortgage rates changing rapidly? Trending up, or down? Are there factors about the transaction, or construction schedules, that might matter? Deciding whether to lock or to stick with market conditions and "float" is a judgement call. Get advice, read and research, and then make the best decision for your situation.

A "home warranty" is frequently available at the time of purchase, and may even be a tool in negotiating terms. These warranties provide protection for a short period of time — like 1 year — against unexpected costs in home systems and appliances. A failed heater or oven, for example, might be covered by a home warranty. This financial protection in the period immediately after home purchase can be helpful, especially if down payment and closing have drained cash reserves. Home warranty may not be an option after purchase, so consider the benefits and costs prior to finalizing your deal.

The elevation of a home, in relation to surrounding terrain, directly affect the risks of flooding. Even a few feet of elevation can make a dramatic difference. If the home is on a "flood plain" — an area of land with inherent risk of flooding during high discharge — lenders will usually require flood insurance. If it is near but noton a flood plain, you may have options regarding flood insurance coverage. Flood insurance is covered through the National Flood Insurance Program. Check FloodSmart.gov for details, then shop insurance coverage for a policy that suits your needs.

Deciding "older home or newer home" is a unique challenge for each buyer and place. Here are some general guidelines to think about. Home Age and Neighborhood Age. More-established neighborhoods with a higher average home age develop their own ambiance over time. Is that what you want? Property Tax Rates. An older home may have a lower tax rate; make sure to ask and compare. Maintenance. Homes require maintenance as they age, but you should assess what has already been done on an older home case-by-case. Energy efficiency is also a key concern; building standards have improved efficiency standards over time, so you may find newer homes to score higher on this key cost. Consider what you want to spend time on, and what you enjoy as well.

Whether its a real walk-through or a virtual walk-through, theres no substitute for seeing a prospective home. Keep your own list of requirements in mind, but also size up and record these things about each: Do the numbers of bedrooms, offices and bathrooms meet or exceed your requirements? Do the other rooms and features provide the space you need now and later? Will your furniture fit, and fit well? Does the structure look solid? Are appliances, heat/AC and other systems in good working order? Are there obvious outstanding repairs? These might be negotiated in the purchase process. How do yards, decks and garage spaces stack up against your needs? You may save time by measuring and recording the results, especially for key rooms or those that are questionable fits. It can be especially helpful to envision the place in very different seasons. What will this be like in snow? Rain? Heat? Save yourself time by "keeping score", with consistent notes and measurements for each place that youre really going to consider.

Regulations require lenders to document the final terms of the loan, and to deliver the document – called the Closing Disclosure – at least 3 business days before scheduled loan consummation. The Closing Disclosure cannot be verbal; it must be a digital or paper document. Any changes after deliver of the Closing Disclosure start the clock again: a new Closing Disclosure must be delivered, at least 3 business days before a revised loan consummation date. In a few circumstances, waiver of the 3-day waiting period is possible, but only when this waiting period would trigger an authentic financial emergency.