TBD Property Mortgage Approval | Underwriter Verified Assets, Income, And Credit
Before starting the pre-approval process, a borrower should understand what an overlay
is to avoid dealing with a lender with an internal guideline on top of VA, FHA, conventional, and USDA guidelines to prevent a last minute denial. The purchase process should always start with the pre-approval process by verifying assets, income, and credit. Loan Originators often have a different mortgage pre-approval process, which some are more meticulous than others. Just because a borrower has a mortgage pre-approval letter does not mean they qualify for a mortgage – the question that should be asked is, “How solid is my mortgage pre-approval letter?
” A TBD property mortgage approval is an optional and additional step to obtaining a solid mortgage pre-approval letter, which credit, income, and assets are verified by a underwriter.
The TBD Property Mortgage Approval Process
The TBD property mortgage approval is a way to have a rock solid pre-approval where income, assets, and credit are reviewed by an underwriter rather than a Mortgage Loan Originator.
- The process starts by a licensed Mortgage Loan Originator taking a complete application without a property.
- On the application, the subject property will have TBD and the Loan Originator will ask for details just as if they were going to submit the loan with a property.
- An experienced Mortgage Loan Originator will send a list of documents that are going to be required for submission.
- Once a complete 1003 (Uniform Residential Loan Application) is complete and necessary documents are gathered to submit:
- An experienced Loan Originator would review all documents and run the Automated Underwriting System (AUS).
- Note that some Loan Originators do not have access to the Automated Underwriting System (AUS) and rely on other people in their company to run the program.
- At Nationwide Mortgage & Realty, LLC our Mortgage Loan Originators have access and are able to run the Automated Approval System (AUS) the same day documents are received.
After a complete credit package, loan application, credit report, income, and assets have been gathered, the package is sent to an underwriter for review. Once reviewed by an underwriter, they will issue a mortgage commitment subject to a sales contract, appraisal on the property, and other property documentation.
Advantages Of TBD Property Mortgage Approval
- A complete credit package, loan application, credit report, income, and assets are already verified by a underwriter.
- The TBD mortgage pre-approval letter often gives negotiating power when putting an offer in on the house.
The TBD property mortgage approval takes a little longer than just going through the pre-approval process without an underwriter verifying documents. An experienced Mortgage Loan Originator usually will not dismiss a borrower that has been denied, but tell them what they need to work on in order to get pre-approved for a home.
After The Pre-Approval Process Is Complete – Issuing A Mortgage Pre-Approval Letter
- Just because a mortgage pre-approval letter has been issued, does not mean that a borrower is guaranteed a loan.
- A mortgage pre-approval letter should always be written based on a credit report, income, and assets that were provided.
- There should be a set maximum mortgage payment, purchase price, loan amount (can vary depending on tax bill and home owners insurance), loan program, maximum loan-to-value, and term of the loan.
- Even if a borrower qualifies, does not mean that a property will qualify.
- The clear to close is obtained by clearing all borrower related and property related conditions.
- Once the purchase contract is accepted, an acceptable appraisal, taxes and home owners association dues should already have been factored, a clear title, acceptable home owner’s insurance policy, and life of a loan flood certification should be furnished.