I know you’ve heard grumblings from buyers about the enormous volume of documentation that is required to obtain a mortgage these days, not to mention the additional requests that always seem to come well into the process that can be frustrating for them. The industry, meaning Fannie and Freddie, is concerned with both credit quality, which they think is the best it has been in many years, and documentation quality, or what they call Loan Quality Initiative (LQI). Guidelines for underwriting have become more strict, even if the credit quality of the borrower is high. Documentation of every condition must be exact – not close, not almost – but exact.

In order to make the loan process easier, we make clients aware of everything they need to know about documentation at the beginning so there are no surprises along the way. This helps them understand that disclosing new information in later stages may trigger requirements for additional documentation which can slow down the process.

I review the borrower’s accounts with them and make sure they have documentation for any deposits that are obviously not payroll. For example, lenders require that deposits from gifts are documented, and deposits from borrowed funds can only be used as a down payment if the funds are secured by real estate or securities (e.g., stocks), and the payment on the borrowed funds must be calculated in the DTI ratio. Another example is if late in the process the client transfers funds into escrow from an account that was not previously disclosed, they must then provide complete statements for this new account.

As a mortgage bank, we’re well versed in the guidelines for all lenders. We work with clients to help them understand documentation requirements at the beginning and throughout every step in the process. Borrowers who provide all of the requested documentation upfront will save themselves headaches and prevent a last minute scramble.

Andy Block - Mortgage Advisor & Financial Advisor
Opes Advisors
Email Me 
Direct: 650.931.0605
Fax: 650.931.0601

License #01096311
400 S. El Camino Real
Suite 250
San Mateo, CA 94402
Fax 650.931.0601

Opes Advisors is licensed as a registered investment advisor with the Securities and Exchange Commission (SEC) and is licensed as a Residential Mortgage Lender by the CA Dept of Real Estate.