A “conventional” (conforming) mortgage is a loan that conforms to established guidelines for the size of the loan and your financial situation. Monthly payments on a conventional fixed-rate mortgage remain the same for the life of the loan, making it an attractive option for borrowers who plan to stay in their home for several years.
Conventional Loan Officers assist in the procedures and paperwork needed to secure a mortgage in which the interest rate does not change during the entire term of the loan, and is not insured and/or guaranteed by the government. They also will be:
- an expert in evaluating the financial condition of loan applicants
- aware of loans that will fit a variety of financial situations
- determine the ability and willingness to repay the loan according to terms
A basic responsibility of loan officers is to seek to find a loan arrangement that is in the best interests of both the applicant and the bank or financial institution that has extended the loan.
Look for a licensed institution staffing those that possess a comprehensive knowledge of the types of loans provided.
Each state requires a specific set of criteria for being able to offer mortgage loans. Make sure your chosen institution has the proper licenses in place to serve you.
Choosing a loan officer first will help in knowing how much you can spend — before you go out and start shopping for homes. Make sure to have the following documentation available to give to your loan officer at the loan application appointment:
- License or passport proving your identity
- Court name change document (if applicable)
- Most recent two years Federal tax returns for each borrower (all schedules)
- Most recent two years W-2’s and/or 1099’s for each borrower
- Complete bankruptcy papers with all schedules and discharge papers (if applicable)
- Two months of most current and consecutive bank/investment/retirement statements on all accounts
- Complete divorce decree/separation agreement/child support court documents (if applicable)
When looking for help in getting a mortgage loan talk to more than one Loan Officer. A personality “fit” with you is key. Questions for evaluating include:
- Are you a mortgage broker or a mortgage banker?
- How many loans have you closed that are for people in my situation?
- Can you walk me through the steps of the loan process?
- What problems can you see potentially arising in my situation?
- What are the downsides to this financial instrument?