Can I apply for a pre-approval before I find a property to purchase?
What is a credit score and how will my credit score affect my application?
Will the inquiry about my credit affect my credit score?
Will I be charged any fees if I authorize my credit information to be accessed?
Are we right for you?
Can I really borrow funds to use towards my down payment?
How do you decide what you need from me to process my loan application?
I'm self-employed. How will you verify my income?
Will my overtime, commission, or bonus income be considered when evaluating my application?
I am retired and my income is from pension or social security. What will I need to provide?
If I have income that's not reported on my tax return, can it be considered?
Can I lock in an interest rate and points before I find a home?
How do I lock my rate?
How will rental income be verified?
I have income from dividends and/or interest. What documents will I need to provide?
Do I have to provide information about my child support, alimony or separate maintenance income?
Will my second job income be considered?
I've had a few employers in the last few years. Will that affect my ability to get a new mortgage?
I was in school before obtaining my current job. How do I complete the application?
If my property's appraised value is more than the purchase price can I use the difference towards my down payment?
I'm getting a gift from someone else. Is this an acceptable source of my down payment?
I am selling my current home to purchase this home. What type of documentation will be required?
I am relocating because I have accepted a new job that I haven't started yet. How should I complete the application?
I've co-signed a loan for another person. Should I include that debt here?
I have student loans that aren't in repayment yet. Should I show them as installment debts?
How will a past bankruptcy or foreclosure affect my ability to obtain a new mortgage?
What, exactly, is an installment debt?
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Yes, you may apply for a pre-approved mortgage loan before you find a home. If you apply now, and if approved, a conditional pre-approval letter will be issued which can be presented, to your real estate agent and seller.

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A credit score, sometimes called a FICO score, is based on information collected each month by the three major credit bureaus: TransUnion, Equifax and Experian. The information is provided by companies such as credit card issuers, utilities and lenders. The information collected includes a number of different factors, including when the credit was opened, payment history and current balances.

Liberty Bank generally uses a report called a “tri-merge” which takes information from all three credit bureaus and creates a single report, including the credit score from each bureau.

We use the information in the report, as well as the credit scores, to evaluate loan applications and also use any additional pieces of information such as income, assets and other information provided during the application process.

Credit scores generally range from about 450 to about 850. However, each bureau uses its own calculation method to determine credit scores.

Higher scores are generally an indicator of good payment history and credit management on the part of the applicant. However, credit scores are only one of the factors used in evaluating a loan application. While a higher score is usually more desirable for both the applicant and the creditor, a high credit score alone is not a gurantee of loan approval.

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Having an abundance of credit inquiries on your credit report within a short time can sometimes affect your credit score. This is because numerous inquiries can indicate that your use of credit is increasing.

However, the credit bureaus generally take into account that you may be shopping for a home loan or car loan. Inquiries of this type, if completed in a short time, will typically have less impact on your credit score.

If you have inquiries on your credit report, we’ll ask you about them and ask whether you have opened any new credit as a result of the inquiries

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There will be no charge at the time you give us permission to access your credit report. No credit scores or credit reports will be displayed online, only a list of your liabilites and payments.

At the end of the online application, if you wish to proceed with submitting the loan request, an application fee will be charged.

At the time of loan closing, a fee for the amount of the credit report that was obtained will be included in the total closing costs.

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At Liberty Bank we pride ourselves on providing excellent customer service whether you're purchasing or refinancing.

We offer a wide variety of mortgage products to meet your individual needs.

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In some circumstances, yes. However, any loans that you take out must be secured by an asset that you own and that ownership must be verified.

If you own something of value that you could borrow funds against, such as a car that has been paid off or another home, it can be an acceptable source of funds.

If you are planning on obtaining a loan, make sure to include the details of this loan in the Expenses section of the application.

Funds obtained from an unsecured loan or from cash advances on a credit card cannot be used towards down payment.

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There are some pieces of information requested on all loan applications, such as income and assets statements.

Your loan application will be reviewed online to determine if it qualifes for a conditional approval. At that time you will be provided with a list of requested information and documentation.

All submitted applications will be reviewed by an underwriter. During that review, additional information may be requested to complete the loan review.

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Generally, the income of self-employed borrowers is verified by obtaining copies of personal (and business, if applicable) federal tax returns for the most recent two-year period. We’ll also ask for a year to date profit and loss statement. This is a list of your business income and liabilities for the year so far.

We'll review the income from self-employment that's reported on your tax returns to determine the income that can be used to qualify. We won't be able to consider any income that hasn't been reported on your tax returns.

Typically, we'll ask for a full two-year history of self-employment to verify that your self-employment income is stable and not decreasing.

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In order for bonus, overtime, or commission income to be considered, you must have a history of receiving it, it must be stable and not decreasing, and it must be likely to continue.

We'll usually need to obtain copies of W-2 or 1099 statements for the previous two years and a recent pay stub to verify this type of income. If a major part of your income is commission earnings, we may need to obtain copies of recent tax returns to verify the amount of business-related expenses, if any.

If you haven't been receiving bonus, overtime, or commission income for at least one year, it most likely will not be given full consideration when your loan is reviewed for approval.

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Generally, the most recent award letter from the pension or the Social Security Administration will be requested.

In addition, any W2 or 1099 statements you receive from the pension will be requested.

It will also be necessary to verify that this income will continue for at least three years since some pension or retirement plans do not provide income for life.

This can usually be verified with a copy of your award letter. If you don't have an award letter, we can contact the source of this income directly for verification.

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Generally, only income that is reported on your tax return can be considered when applying for a mortgage. Unless it is non-taxable income and is not required to be included on a tax return.

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Unfortunately, we'll need to gather some information about your new home before we can offer a rate lock, so you'll need to have a fully signed and executed contract to purchase your new home and complete an application before we can lock in your interest rate.

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You can lock your rate online at the time of application, or you can float the rate and lock in at a later date.

If you choose to lock in later, you can go to the Loan Status section of our website and lock your rate there.

If you prefer, you can contact us at 888-906-6210 to lock your rate.

If locking through the online application, you may be requested to sign a lock disclosure.

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If you own rental properties, we'll generally ask for the most recent year's federal tax return to verify your rental income. We'll review the Schedule E of the tax return to verify your rental income, after all expenses except depreciation. Since depreciation is only a paper loss, it won't be counted against your rental income.

If you haven't owned the rental property for a complete tax year, we'll ask for a copy of any leases you've executed and we'll estimate the expenses of ownership.

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Generally, two years personal tax returns are required to verify the amount of your dividend and/or interest income. In addition, we will need to verify your ownership of the assets that generate the income using copies of statements from your financial institution, brokerage statements, stock certificates or Promissory Notes.

Typically, income from dividends and/or interest must be expected to continue for at least three years to be considered.

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Information about child support, alimony, or separate maintenance income does not need to be provided unless you wish to have it considered for repaying this mortgage loan.

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Typically, income from a second job will be considered if a one-year history of secondary employment can be verified.

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A full two year history of employment will be required during the loan application.

If you're paid on a commission basis, a recent job change may be an issue since we'll have a difficult time predicting your earnings without a history with your new employer.

However, your full employment and income information will be reviewed during the loan process.

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If you were in school before your current job, provide a copy of your diploma along with the other requested documentation. You can also enter the name of the school you attended and the length of time you were in school in the "length of employment" fields. You can enter a position of "student" and income of "0."

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If you are purchasing a home, we'll have to use the lower of the appraised value or the sales price to determine your down payment requirement.

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Gifts can be an acceptable source of down payment, if the donor is related to you or your co-borrower. The donor will be asked to sign a Gift Affidavit, stating that the funds are a gift and are not expected to be repaid. They will also be asked to provide documentation of ownership of the gift funds and that they have sufficient funds to make the gift.

If your loan request is for more than 80% of the purchase price, you’ll need at least 5% of the property's value in your own assets that can be verified with asset statements.

Prior to closing, we'll verify that transfer of the the gift funds from the donor’s account to your account. A verification of the transaction will be requested.

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If you're selling your current home to purchase your new home, you’ll be asked to provide a copy of the executed sales contract at the time of application. You will also be asked to provide the settlement or closing statement you'll receive at the closing of your current home to verify that your current mortgage has been paid in full and that you'll have sufficient funds for our closing.

Often the closing of your current home is scheduled for the same day as the closing of your new home. Although you will have already provided a copy of the executed sales contract, you’ll also be asked to bring your settlement statement with you to your new mortgage closing.

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If you will be working for the same employer, complete the application as such but enter the income you anticipate you'll be receiving at your new location.

If your employment is with a new employer, complete the application as if this were your current employer and indicate that you have been there for one month. The information about the employment you'll be leaving should be entered as a previous employer.

If you have any employment contracts or offer letters, please include them with your other documentation.

A two year history of employment will be required in the loan application.

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Generally, a co-signed debt is considered when determining your qualifications for a mortgage and should be included in your application.

If you can provide verification that another party has been making the payments on the loan for at least 12 months, it may be possible to exclude the loan. However, that determination is made during the review of the loan application.

You may be asked to provide a copy of the loan documents to complete the review.

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Any student loan shown on your credit report should be included in the application. If you are not sure exactly what the monthly payment will be at this time, enter an estimated amount.

Your loan application will be reivewed to determine if the payment must be included. Your student loan lender may need to be contacted to provide additional information.

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If you've had a bankruptcy or foreclosure in the past, it may affect your ability to get a new mortgage. Unless the bankruptcy or foreclosure was caused by situations beyond your control, we will generally require that two to four years have passed since the bankruptcy or foreclosure was discharged.

It is also important that you've re-established an acceptable credit history with new loans or credit cards.

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An installment debt is a loan that you make payments on, such as an auto loan, a student loan or a debt consolidation loan.

Do not include payments on other living expenses, such as insurance costs or medical bill payments. Any installment debts that have more than 10 months remaining will be used when determining your qualifications for this mortgage.

Contact Us


Loan Officers 847.986.8881

Loan Processing 1.888.906.6210

mortgages@libertybank.com

FAQs

FAQs