As your local New American Funding representative, Gina Spearman is dedicated to providing superior service and personal expert guidance throughout the home financing process. Contact Gina today to learn more about competitive rates and fees and innovative mortgage solutions provided by New American Funding.
Excellent communication is the only way to help prevent surprises throughout the home buying process, and that’s what you’ll get from New American Funding through our communications credo. The following 10 steps will help guide you through the mortgage process.
- You complete the on-line application.
- Pre-Approval Consultation with lender: discuss goals and objectives and determine the best financing solution for you.
- You gather and send documents listed in the documentation checklist to lender.
- Lender submits your documents to underwriting for a credit decision.
- Lender notifies you of the underwriter’s decision and reviews all documents needed for final
- You gather items needed to fulfill your final loan approval conditions along with homeowner’s insurance.
- Lender calls you to confirm final loan approval.
- Your closing documents are prepared and sent to the closing attorney.
- Closing attorney prepares your settlement statement disclosing the amount of money that you need for closing. Lender will call and review your settlement statement 24-hours prior to closing.
- Very smooth, on-time closing!
Prompt completion of the following checklist will expedite the loan closing process.
Income and Asset Statements:
- Past two years W-2 or 1099 forms
- Last 30 days period of pay stubs
- If you are self-employed, commissioned, or using bonus investment income to qualify, send past two years tax returns and year-t-date profit and loss statement
- Two months original bank statements (all pages) on all checking, savings and investment and retirement accounts listed on application
- You will receive documents in the mail to sign. Please sign the documents and mail back to lender.
Homeowner’s Insurance Policy:
- Please immediately coordinate your Homeowner’s Insurance Policy and forward the insurance company and contact person to the processor.
- At closing, you will need to come with certified funds (check should be made payable to you).
Adjustable-rate mortgage (ARM):
A mortgage with an interest rate and payment that change periodically over the life of the loan based on changes in a specified index.
A debt security whose issuer has the right to redeem the security at a specified price on or after a specified date, but prior to its stated final maturity.
The portion of principal and interest due on a loan that is written off when deemed to be uncollectible.
A security that represents ownership in a company but gives no legal claim to a definite dividend or to a return of capital.
A mortgage loan that is not insured or guaranteed by the federal government.
A method to reduce credit risk by requiring collateral, letters of credit, mortgage insurance, corporate guarantees or other agreements to provide an entity with some assurance that it will be recompensed to some degree in the event of a financial loss.
Credit loss ratio:
The ratio of credit-related losses to the dollar amount of MBS outstanding and total mortgages owned by the corporation.
A process that uses recorded information about individuals and their loan requests to assess, in a quantifiable, objective, and consistent manner, their future performance regarding debt repayment.
The sum of foreclosed property expenses plus the provision for losses.
A security in which the issuing company generally agrees to repay the principal (typically, the original amount borrowed) and make interest payments according to an agreed schedule.
The failure of a borrower to comply with the terms of a note or the provisions of a mortgage.
A mortgage loan on which a payment has not been made by the due date.
A financial instrument that derives its value from an underlying security or notional amount.
The weighted-average life of the present value of all future cash flows, both principal and interest, of a security. It is used as a measure of the sensitivity of the value of a security to changes in interest rates.
Earnings per share (EPS):
The net earnings of a corporation divided by the average number of shares of its common stock outstanding during a period. A common method of expressing a corporation’s profitability.
A mortgage loan in which the interest rate does not change during the entire term of the loan.
The lender’s postponement of legal action when a borrower is delinquent. It is usually granted when a borrower makes satisfactory arrangements to bring the overdue mortgage payments up to date.
The legal process by which property that is mortgaged as security for a loan may be sold to pay a defaulting borrower’s loan.
Global Debt Facility:
A debt issuance facility through which U.S. dollar and foreign currency debt securities may be offered to investors worldwide with the feature of clearing and settlement through a variety of clearing systems.
Compensation paid by a lender to New American Funding for the guarantee of timely payments of principal and interest to MBS security holders.
Interest rate swap:
A transaction between two parties in which each agrees to exchange payments tied to different interest rates or indices for a specified period of time, generally based on a notional principal amount.
A mortgage loan with a contractual maturity at time of purchase equal to or less than 20 years.
Lender option commitments:
An agreement giving a lender the option to deliver loans or securities by a certain date at agreed-upon terms.
The tasks a lender performs to protect a mortgage investment, including collecting monthly payments from borrowers and dealing with delinquencies.
Loan-to-value (LTV) ratio:
The relationship between the dollar amount of a borrower’s mortgage loan and the value of the property.
Activities designed to reduce either the likelihood of the corporation suffering financial losses on a loan or the final dollar value of those losses in the event of a borrower default.
Mandatory delivery commitment:
An agreement that a lender will deliver loans or securities by a certain date at agreed-upon terms.
Unsecured general obligations of New American Funding with maturities of one day or more and with principal and interest payable in U.S. dollars.
Any change to the original terms of a mortgage.
A legal document that pledges property to a lender as security for the repayment of the loan. The term also is used to refer to the loan itself.
Mortgage-Backed Security (MBS):
A Caliber Home Loans security that represents an undivided interest in a group of mortgages. Principal and interest payments from the individual mortgage loans are grouped and paid out to the MBS security holders.
A building with more than four residential rental units.
An asset such as a mortgage that is not currently accruing interest or on which interest is not being paid.
Notional principal amount:
The hypothetical amount on which interest rate swap payments are based. The notional principal amount in an interest rate swap generally is not paid or received by either party.
Stock that takes priority over common stock with regard to dividends and liquidation rights. Preferred stockholders typically have no voting rights.
A procedure in which the borrower is allowed to sell his or her property for an amount less than what is owed on it to avoid a foreclosure. This sale fully satisfies the borrower’s debt.
Real Estate Mortgage Investment Conduit (REMIC):
A security that represents a beneficial interest in a trust having multiple classes of securities. The securities of each class entitle investors to cash flows structured differently from the payments on the underlying mortgages.
An agreement between a lender and a borrower who is delinquent on his or her mortgage payments, in which the borrower agrees to make additional payments to pay down past due amounts while still making regularly scheduled payments.
Return on average common equity:
Net income available to common stockholders, as a percentage of average common stockholders’ equity.
A financial tool that provides seniors with funds from the equity in their homes. Generally, no payments are made on a reverse mortgage until the borrower moves or the property is sold. The final repayment obligation is designed to not exceed the proceeds from the sale of the home.
The amount of capital necessary to absorb losses throughout a hypothetical ten-year period marked by severely adverse circumstances.
Secondary mortgage market:
The market in which residential mortgages or mortgage securities are bought and sold.
A financial instrument showing ownership of equity (such as common stock), indebtedness (such as a debt security), a group of mortgages (such as MBS), or potential ownership (such as an option).
A single-family mortgage that is 90 days or more past due, or a multifamily mortgage that is two months or more past due.
The sum of proceeds from the issuance of stock and retained earnings less amounts paid to repurchase common shares.
Stripped MBS (SMBS):
Securities created by “stripping” or separating the principal and interest payments from the underlying pool of mortgages into two classes of securities, with each receiving a different proportion of the principal and interest payments.
A bank or trust company charged with keeping a record of a company’s stockholders and canceling and issuing certificates as shares are bought and sold.
The process of evaluating a loan application to determine the risk involved for the lender. It involves an analysis of the borrower’s ability and willingness to repay the debt, and the value of the property.