Return to Top What you need to know before you borrow

A mortgage is the biggest financial decision and investment you will make in your personal life. Typically, before people purchase a pair of shoes, an airfare or even a car they spend a lot of time researching for the best deal. They look for a brand that will deliver on its promise. They look for simplicity, honesty and value. Surprisingly, people sometimes spend less time researching their mortgage companies.

At Activus, we want you as a customer. But more importantly, we want you to make the right choice. That's why we recommend that you do your homework before you decide which company will be your lender of choice. Just as mortgage companies will review your qualifications, you should review theirs. Compare rates and terms, ask for testimonials, read what's written abou lenders in the media. Whatever you do, make sure you take the time and then make an informed decision. And remember, you're not alone. If you need help from independent, reliable and respected sources consider contacting: ACORN Housing (Contact info to be provided for each) National Fair Housing Alliance National Community Reinvestment Coalition Springboard

Return to Top What should I do to help financially prepare for
a home loan?

Here are a few tips to assist you when it comes to applying for a loan:

• Use cash instead of credit for your purchases.
• Avoid making any large credit purchases—the added debt could impact your ability to qualify for a loan.
• Contact creditors immediately if you have a problem or concern about your ability to make payments on time.
• Put money aside into savings so you'll have a financial cushion in case of an emergency.

Return to Top How will my credit score affect my loan application?

Credit scoring plays a significant role when you apply for a loan. Higher credit scores help you to be eligible for more loan options. If you've had credit difficulties in the past, there are still mortgage programs available, but they will usually cost more and will vary depending on the severity of your credit problems.

Return to Top How do I increase and protect my credit rating?

Here are a few general tips to assist you in raising and maintaining your credit score:

• Maintain two to three revolving charge accounts (such as Visa or MasterCard) in good standing.
• Have a couple of other credit card accounts, such as department stores or gas cards, in good standing.
• Avoid “finance” company credit card offers.
• Avoid credit inquiries-they lower your credit score.
• Don’t max out your credit cards-the ratio of available credit to your total credit balances is very important.
• Don’t apply for multiple credit lines; this triggers an inquiry of your credit, which lowers your credit score.
• Never co-sign a loan for someone else

Return to Top What kind of documentation will I need to
provide the lender for verification?

As each loan has different variables, there is no single list of documents needed for all applicants. You should be prepared to provide copies of the following documents to your lender:

Employment & Income Data

• W-2 tax forms, past two years
• 1099's
• Pay stub showing current year-to-date earnings (two most recent stubs)
• Your job history and any explanation of a job change within the past two years
• If self employed (defined as owning 25% of a business or more), you need business and personal federal tax returns (two years, including schedules), a current year-to-date profit or loss statement and a K-1 on all partnerships

Assets

• Bank account statements, past two months
• Investment account statements
• Retirement account statements
• Signed gift letter and transfer of funds verification

Liabilities

• Credit Cards - include account numbers and balances
• Auto loans and leases - account numbers and value of car
• Explanation and paperwork of any derogatory credit in the past seven years
• Explanation letter of any derogatory credit (bankruptcy, collection, foreclosure or default)
• Student and personal loans - include account numbers, monthly payments and balances
• Landlord address(s) for past two years and rental amounts

Property & Realtor Information

• Name and contact information of your Realtor (business card)
• Homeowners insurance information
• Rental or lease agreements
• Residence & address for past two years