When is an application really an application?
According to federal guidelines, lenders are required to provide mortgage loan applicants with certain documents within 3 days of application. Some of these basic documents include a Good Faith Estimate and a Truth in Lending Statement. These forms are to disclose to the potential borrower estimated costs and rates associated with that lender’s program.
The question is, when is this required? When does an application actually become an application?
Calling a lender and giving name, address and social security number is not an application. In order for an application to be made and considered, a lender must be able to make a decision… in other words, they need all the information. Personal information like the name, address and social security number of the borrower; Financial information like work history, income documents (such as W2’s and paystubs) and bank / investment statements; credit information like a credit report or alternative credit if needed… these are just the basics. Oh.. there is one more very important item needed… a house.
If you are refinaning a mortgage and have submitted the other items needed, then this is an application. However, if you are thinking of buying a home, you will need a offer to purchase to complete your application. At this point, your lender will be required to provide you the disclosures required by law.
This being said… if you, as the borrower, would like this information earlier in the process, simply ask for it. If your lender has enough information to have a good idea as to the direction of your loan, they should be able to give something to you. If your lender does not have enough information yet, they can tell you what is still needed in order to provide this.
Beware of lenders that give Good Faith Estimates and Truth in Lending statements with limited information. Without the proper information, a lender can not give you solid information on which to base any decision. What they give you with limited information will be just as limited in its reality.
So how do you know if they are being straight with you? The bottom line is this… talk to your lender. Actually talk and feel them out. If you are not feeling secure in them after the conversation, try another lender. Even in todays world of technology, talking to someone will still tell you what you need to know… if you will listen.