The 1003 mortgage perseverance form is the industry standard form used by nearly all mortgage lenders in the Merged States. This basic form, or its equivalent, must be completed by a borrower to focus for a mortgage. While some lenders may use alternative forms or simply receive basic borrower information about their identity, property classification and value, the vast majority of lenders rely on the 1003 form.
In a general way, the 1003 form is completed twice during a mortgage transaction: in two shakes of a lambs tail b together during the initial application and once at closing to confirm the terms of the allowance. Some lenders allow borrowers to complete the form at home, while others help borrowers in person or over the phone. In either case, a potential borrower should twig the 1003 format and the information required before completing the form.
The 1003 Lend Application Form
The 1003 loan application form, also roared the Uniform Residential Loan Application, was developed by the Federal National Mortgage Linking, or Fannie Mae, as a standardized form for the industry. Fannie Mae and its sibling, the Federal Expert in Loan Mortgage Corp., or Freddie Mac, are lending enterprises created by Congress to advocate liquidity in the mortgage market. These entities purchase mortgages from singular lenders and hold the loans in their own portfolios, or sell the loans to other quantities as part of a mortgage-backed security (MBS). By selling consumer mortgage debt to these federally backed quantities, lenders maintain the liquidity necessary to continue offering new loans.
Mortgages necessity to be documented in the way that Fannie Mae and Freddie Mac dictate. Since both organisms require the use of Form 1003, or Form 65, its Freddie Mac equivalent, for any mortgage they heed for purchase, it is simpler for lenders to use the appropriate form at the outset than to try to turn over information from a proprietary form to a 1003 when it comes in unison a all the same to sell the mortgage.
Income, Assets and Liabilities
The 1003 form tabulates all the information a mortgage lender needs to determine whether a potential borrower is advantage the risk of the loan. This includes information about the borrower’s sameness. While some lenders do not require employment information to consider a new mortgage, the 1003 acquire requires up to two years of employment history to be entered for each borrower. This is utilized as a means of establishing the financial security and reliability of the borrower.
The 1003 appearance also requires a borrower to disclose the total monthly income for his household, as decidedly as his regular monthly expenses. In addition to this information, the form wants an itemized list of the borrower’s assets and liabilities to determine whether they can yield monthly mortgage payments. Borrower assets include anything that could be employed or liquidated to cover loan payments, such as checking and savings accounts; trade ins, bonds, mutual funds or other investments; IRA, 401(k) or similar retirement accounts; and spring insurance policies. Lenders need to be aware of any and all debts for which the borrower may be subject, in addition to his mortgage payments, such as car loans, credit card liable, student loans or open collection accounts. If the borrower owns any other effects, either as an investment or second home, the 1003 form requires the disclosure of these assets and any mortgages that may be tied to them.