The following will help you better understand the mortgage process.
Step: 1 Applying for Your Loan
If you're purchasing a new home, it's smart to get pre-qualified before you begin your search. With a qualified letter in hand, you'll know how much you can afford to pay and you'll have greater negotiating power.
It only takes a few minutes, to complete a loan application over the phone, in person, or by clicking the “Apply Now” button on your Loan Officer's web page. We can help you find the right mortgage for your specific situation, as well as determine how much you can afford to borrow based on your current income, monthly obligations, and assets. We will also order a credit report for each of the applicants to review your payment history.
To make applying for your loan a smooth process, please have the following information and documents available for each applicant:
- Personal information, such as social security number(s), full name, employment information, etc.
- Previous two year’s W2 forms and most recent pay stub.
- Previous two-year’s tax returns or business returns if you are self-employed.
- Monthly account statements for bank and brokerage accounts.
- Monthly obligation information, including any monthly contractual obligations that may not appear on your credit report, such as a car payment, outstanding credit card debts, alimony or child support.
- Your current monthly mortgage statement if you already own a home.
Plus, if you have already selected a property, the following information will be helpful:
- Property information, including property address, county, property type and the estimated market value or purchase price.
- A signed sales contract.
- Homeowner’s insurance statement or an estimate.
- Condominium or homeowner’s association dues or an estimate.
- Real-estate tax bill if you already own a home.
Step: 2 Initial Approval
Our application process takes only minutes - not days - to determine the loan products for which you qualify. Once your application has been completed, we will have the necessary information to give you a pre-approval letter. This pre-qualification may contain certain conditions that must be met before a final loan approval can be given to you.
Once you apply, you will receive important loan disclosures. Some common disclosures include the following:
Good Faith Estimate (GFE) This is an estimate of the closing costs and fees required to close your loan, such as points, related fees and costs for third-party services, such as a title search and an appraisal.
Truth-in-Lending Statement (TIL) this is a written disclosure of credit terms and conditions for your loan. This document will include the finance charge, annual percentage rate, total payments, amount financed and other charges or estimated charges to be incurred in your loan transaction as required by the Truth-in-Lending Act.
Loan Disclosures you will also receive specific loan disclosures that are required by applicable laws and regulations.
Step: 3 Processing Your Loan
Once you have a property selected, we will order the following items:
Title search and report This is a review of the legal records to check the validity and completeness of the title to the property. This search will uncover any liens or other claims made against the property by other people.
Appraisal This is an opinion or estimate of the value of a property made by a person qualified by education, training, and experience to estimate property values based on factors such as the current real estate market and comparable home sales in the neighborhood.
Flood certification This is a certification that the property is or is not located in a flood plain. This certificate is required by law for a mortgage and will indicate if flood insurance is required for the property.
While we are waiting to receive these documents, your supporting documentation, will be reviewed to determine whether your income and assets meet our underwriting criteria.
Step: 4 Final Loan Review
Once the title report, appraisal and flood certification are received, along with any additional documentation you need to provide, your loan file is ready for final review. An underwriter will review your complete loan file and make a final credit decision.
Once the final loan decision has been made, you will be contacted by a closing specialist to schedule the loan closing. At this time, you will receive a final estimate of your closing costs as well as the amount of any additional funds that you will need to bring to your loan closing. These costs are typically provided to you on the HUD-1 Settlement Sheet. It is important to know that these funds must be brought to your closing as a certified or cashier's check. You may be able to wire or transfer funds electronically by ACH to the closing agent's escrow account prior to closing. Personal checks are not accepted.
You will also need to provide proof that you have one of the following types of insurance for your new property:
Hazard insurance This type of insurance protects you in the event of any loss or damage to the property due to theft, fire or certain weather-related losses once it is secured by the mortgage loan.
Flood insurance If the property resides in a high risk flood plain, this insurance is required and could provide compensation to you and the mortgage company in case the property is lost or damaged from rising water.
Step: 5 Closing Your Loan
Your closing is the meeting between you, the seller, your real estate agent, and our closing agent. At this meeting, the property and funds legally change hands and the mortgage documents are signed. The closing will typically take place at a Closing Agent’s or Escrow Agent’s office. A Closing Agent or Escrow Agent is usually an attorney, who witnesses the execution of the loan closing documents.
At the loan closing you will review and sign the required closing documents that allow us to transfer the necessary funds to the seller, and that signify your agreement to repay the loan used to purchase your new property. The Deed of Trust or Mortgage is the document that places a lien on the property as security for repayment of your home loan. The Note represents your agreement to pay us back according to the agreed upon terms of the loan.
Step: 6 Servicing Your Loan
Once your loan has closed, it will be transferred to our Servicing Department. You will receive monthly mortgage statements or you can pay your mortgage online through Chevy Chase Bank, a division of Capital One, N.A's Mortgage Access at www.chevychasebank.com. You will also be able to set up recurring payments and obtain other information regarding your loan on the Mortgage Access website.
Each year, you will receive an IRS Form 1098 that will detail the amount of interest paid for your loan in the past year. This form is required when you complete your annual tax return.
Our Servicing Department pays your annual taxes and insurance premiums if these items are being collected as part of your monthly mortgage payment.
Chevy Chase Bank, a division of Capital One, N.A. © 2009