Welcome to Black Diamond Mortgage! What to Expect in a Mortgage Transaction
Here are some important things to know about the process that will last typically between 2-5 weeks, depending on your contract and the complexity of your transaction:
***Please read our Identity Theft Education Page to learn how to keep your own information safe.
***Are you getting an Adjustable Rate Mortgage (ARM)? Please review this disclosure and CHARM information packet from the CFPB (Consumer Financial Protection Bureau).
***Are you Buying a Home? Please review the Home Loan Toolkit disclosure and information packet from the CFPB (Consumer Financial Protection Bureau).
***All loans will be disclosed the Mortgage Loan Originator Disclosure during the initial disclosure process. A copy of this can be found here. In the event that one of our lenders does not send this out during the initial disclosure process, we will send this out for our borrowers to sign.
1) Emailed and mailed disclosures:
When we register your loan with a lender, they will email and/or physically mail a disclosure package to you for their own compliance purposes. It’s important to understand you do not need to print and sign the documents unless we specifically tell you to. When receiving these emails, it is important to download the disclosure package and for you to read and consent to the electronic disclosures as this makes your loan get to our underwriter FASTER.
2) Appraisals:
Appraisals typically take 2-3 weeks to be completed. If you do not close FOR ANY REASON after your appraisal has been completed then you will still be responsible for paying for the appraisal.
Please be aware that appraisals do not always confirm everyone’s expectations of the purchase price. In the unfortunate circumstance where this occurs please be prepared to deal with re-negotiations, corrections or re-valuations of the appraisal report (only allowed for “bona-fide inaccuracies”), or the purchase of a second, “more accurate” appraisal.
3) Verification Documents:
You will generally be expected to provide the following:
- A copy of each borrower’s driver’s license
- Current pay stubs (usually the last 3 consecutive pay stubs)
- Federal tax returns for the past two years (all pages) including standard forms applicable such as W-2 or K-1 (Note: Business federal tax returns and additional support documents may be requested of self-employed borrowers)
- Current bank account statements (The last 2 months received, ALL PAGES of the bank statement, front and back). (See further information below regarding bank account verifications.)
- If you have recently divorced, filed for bankruptcy or foreclosure, we will need documentation to verify this, such as a divorce decree, property settlement agreement, bankruptcy discharge, and possibly other documents, etc.
If you currently own Real Estate, we would like:
- A current mortgage statement for each mortgage you hold
- The contact information for the homeowner’s insurance agent for each property you insure
4) Bank Account Verifications (PLEASE READ):
When we look at bank documentation we need to be able to see your full name, account numbers, and the name of the bank. Do not black out items to protect your privacy. We need to see all of the pages (If it says page 1 of 5, then we need to see all 5 pages).
Bank verification is all about deposits. Every deposit of funds during the period being reviewed will need to be “sourced” with evidence of where it came from (exceptions exist, but they require an explanation and you may need to demonstrate more available funds). Any deposit from another bank account will trigger the need to review 2 months statements of the bank account that the deposit originated from. Therefore, during the loan process avoid moving funds, selling stocks, making irregular deposits, or cash deposits to avoid additional paperwork.
5) Avoid Using Credit:
From now until closing, any action that reports to credit agencies is reported to us. Please contact us before obtaining or pre-approving for ANY new credit, in order to avoid delays in closing this loan. We may approve your ability to use credit, but this also might disqualify you, so ASK FIRST.
6) Closing Date:
Your contract will have a closing date which we will do our best to meet. Our ability to meet this date includes the delivery of required verification documents, an appraisal, and collaborating with third parties such as the title company, your insurance agent, your employer, etc. Please continue to check in on this process so that we can update you on your loan’s needs or of any potential delays so there will not be a misunderstanding about the closing date. Again, we will do our very best and keep you informed.
7) Homeowner’s Insurance:
You will be required to obtain a homeowner’s insurance quote. The company you use is your choice. Please keep in mind that from time to time, the agent will not supply quite enough insurance for your new home, and we will ask them to increase your coverage amount. (You must have enough coverage to cover your new loan amount at a minimum)
8) Every transaction is unique, so this list is not necessarily “all-inclusive,” but this will help us get started. Ask as many questions as you need to of your loan officer or myself.
We are here to help and we want nothing more than for your deal to go perfectly. Please check with us often and feel free to contact us with any questions!