Loan Process

Loan Process

Buying a home may be the most exciting, confusing and stressful financial transaction you will ever undertake.  Even if you have done it several times you can still find the process complicated and intimidating, particularly given all the new regulatory and compliance rules surrounding the mortgage process.  If you understand the steps required to qualify for a mortgage loan much of the stress can be avoided.   The following explanation of the loan application process is intended to help you through the complexities of obtaining a mortgage loan.

  1. C&F’s Pre-Qualification Steps
  2. Current Mortgage Products
  3. The Application Process
  4. Loan Verification Process
  5. Assets for Closing
  6. Personal Liabilities
  7. Credit Report
  8. Rental or Mortgage History
  9. Additional Information that May be Required
  10. Appraisal
  11. What is Next?
  12. Closing
  13. After Your Closing
  14. Reduce Anxiety

C&F’s Pre-Qualification Steps

This is a very important step and may assist you negotiating your purchase contract.

Information will be gathered regarding income and debts and a determination can be made as to how high your monthly mortgage payments can be and how much cash you will need at closing. During this process, the different programs  will be explained by your C&F Loan Officer  to help determine which program best suits your financial needs. Please contact your C&F Loan Officer to complete a free prequalification analysis.  

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Current Mortgage Products

Your C&F Loan Officer will review and explain the current mortgage products available to allow you to make an informed decision -  Click here for the mortgage programs available.

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The Application

The C&F Loan Officer will assist you with the completion of the loan application. The loan application process will be much easier and more accurate if you prepare for it ahead of time. A great deal of detail will be asked about your personal finances including bank account numbers and balances, current loan amounts, payments, credit card account numbers and any other financial information that would be specific to your transaction. Please keep in mind your loan officer may ask for additional information during the loan process. The quicker you can respond to the requests the faster your loan process will be.    Please click here for a list of items to prepare for your loan application.  

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Loan Verification Process

Employment verification : Your ability to make the regular payments on the mortgage and to afford the costs associated with owning a home are primary considerations during  loan approval process and should be your primary concern.   At a minimum, the required information includes:

At least two years employment history with the employer’s names and address, your job title or position, length of time on the job, salary, bonuses, commissions and average overtime pay, recent paycheck stubs and federal W-2 forms for two years (full federal tax returns may be required.)  If you are self -employed full tax returns and financial statements for 2 years and a profit and loss statement for the current year to date will be required.

If you are relying on income from other sources, such as rental property, social security or disability payments, child support, etc. you must provide adequate proof of the source.

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Assets for Closing

A detailed listing of your personal assets is required on the loan application form.    At a minimum, the following information must be available:  all bank accounts, checking and savings, money market accounts and brokerage accounts with the name of the institution, names on the accounts, account numbers and current account balances, recent bank statements for at least two months, current value of stocks, bonds, CDs and other investments including  vested interest in all retirement funds.

Gifts from a relative, employer or  nonprofit organization  may sometimes be used but must be verified in writing.   Your C&F Loan officer will provide the required documentation regarding gift funds.

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Personal Liabilities

Please itemize all of your current bills, loans and other debts, including credit balances and monthly payments.  Debts include automobile loans, credit cards such as Visa, Mastercard and other retail store accounts, finance companies, credit union loans, existing mortgage loans including home equity loans, personal notes or other obligations.

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Credit Report

The information you provide on the loan application will be verified by a credit report.  Differences between your figures and those on your credit report will raise questions and may delay the approval of your loan.    It is to your advantage to take time to get your data as accurate as possible as you complete the loan application.

Please discuss any prior credit problems or employment lapses in order that we may work with you in the early stages of your loan application.   If you have been through a  bankruptcy or foreclosure proceedings within the past seven years, be prepared to give full details and copies of applicable documents regarding them.

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Previous Rental or Mortgage History

Your previous rental and/or mortgage history is a key component of the approval process.  Please provide the information requested by your loan officer including your landlord’s name and address, phone # and possibly cancelled checks.     

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Additional Information that May be Required

You will be asked to sign a section of the loan application form that contains your certification that the information you have provided is correct to the best of your knowledge, your promise to advise the lender of any material changes in the information; and your consent to (1) verification of the application data (2) submission of the account history to credit reporting agencies and (3) transfer of the loan or servicing to successors to the original lender.   

The last part of the application requests information on the race, ethnicity and gender of the applicants.  The Federal Government uses this information to monitor lenders compliance with fair housing and ECOA laws.  Providing this information is strictly voluntary on your part and has no effect on your loan application.  We are required however by federal law to request this information.

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Appraisal Information

Because the property is security for the loan, C&F will order an appraisal on your property and comply with the Appraisal Independence Requirements.

This regulation requires strict adherence to appraisal independence safeguards and standards. You are entitled to receive a copy of your property appraisal report no later than three business days prior to closing of your mortgage loan transaction.  You will sign a disclosure form at the time of application outlining the two options regarding timing of receipt of the appraisal report.   The appraisal is typically ordered shortly after your application and you will be charged the fee for this service if the appraisal cost has been incurred.

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After the Loan application - What is Next?   

After the loan application has been completed it will be turned over to the loan processor to complete validation of the above information and thereafter to the loan underwriter for a decision.   The loan processor will validate the employment and asset information, order the credit report, property appraisal and other documents.  The time it takes to receive these documents  affects the length of time required for approval of the loan so the more information you provide upfront will help speed this process up.  Your C&F Loan Officer will be able to give you an idea of the processing time for your loan application.

Within three business days after completing the application, C&F will provide a Good Faith Estimate of the anticipated closing costs and a Truth in Lending Statement.   The Good Faith Estimate of Closing Costs (GFE) provides an estimate of your settlement charges and loan terms.   The Truth in Lending statement shows, among other things, the estimated monthly payment and the total of all finance charges on your loan, stated as an annual percentage rate (APR).   The APR represents the dollar amount of the finance charges you pay either up front or over the life of the loan converted to an annual interest rate.   Since the APR includes origination fees and other charges as well as interest on the mortgage loan, the APR is usually higher than the interest rate on the loan.

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Closing

Once the loan application is approved, the necessary documents will be prepared for closing the transaction.    C&F closing department will work closely with the loan officer and the closing agent to ensure all conditions of the loan approval are met and a convenient time is scheduled for you to sign the loan documentation with the closing agent.

At the closing:

  • Please bring valid identification
  • Review your final application to ensure the interest rate and loan terms are what you agreed  
  • Confirm the information on the final application is true and correct – Do not proceed with the closing if information is inaccurate or has changed             
  • Be prepared to bring a cashier’s check for your down payment and closing costs  

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After Your Closing

Please contact your C&F representative if you have any issues or concerns after closing  - we appreciate your feedback and your complete satisfaction is very important to us.

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How can I reduce the anxiety of the loan process?

  • Keep the lines of communication open with your loan officer - it may take several weeks to process the application
  • Please respond quickly if  C&F needs additional information or documents  during the process  – an immediate  response to our requests helps  keep the closing  on schedule 
  • Mortgage loans today require much more paperwork and legal documentation than in the past and we do not ask for more than is absolutely necessary.
  • Advise your loan officer immediately of any change in your financial profile:  job change, additional debts, credit inquiries, etc.     Do not sign the final closing documents  if your financial profile has changed – serious consequences may result as outlined in the documents you signed during the loan process. 

This is intended to provide a broad overview of the mortgage process.   Each transaction is unique.  Your C&F Loan Officer will provide specifics to your transaction throughout the process.

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