Full Doc Loans - NY Mortgage

Banks and secondary market investors offer mortgages with the lowest interest rates to
applicants with low risk profiles. These are applicants with sound credit histories,
sufficient incomes, ample assets, and significant down payments. In order to prove to
lending banks that they are low risk borrowers, these applicants must furnish credit,
income, and asset documents to prove their cases. Mortgage applications with all these
documentations are referred to as Full Documentation loans, or Full-Doc loans.

When evaluating an applicant's credit profile, banks look for a pattern of responsible
credit management on the applicant's part. Lender banks scrutinize the applicant's
credit report to determine whether the applicant has used credit in the past, repaid debts
in a timely manner, been in foreclosure, and ever filed bankruptcy. In short, lenders
make sure that the loan applicant has not demonstrated a history of mismanaging credit.

Lenders also examine the credit scores contained in the applicant's credit report. These
scores are numerically values assigned by three credit bureaus base on the individual's
past credit management behavior. A score of 720 or above is considered excellent
credit. A scores between 620 to 719 is considered average to above average. Home
buyers with average scores have no difficulty getting mortgage loans. A person with a
score of 620 or below is considered to have bad credit. Although most neighborhood
depository banks do not grant loans to home buyers with scores of below 620, many
sub-prime mortgage banks thrive on making loans to non-prime borrowers, often at
higher interest rates.

Banks also required Full Documentation loan applicants to prove their capability to
repay the mortgage. Basic income documentations included 2 consecutive, most current
paystubs and W2's/tax returns for the last 2 years. Lenders examine the paystubs for
evidence of sufficient income to repay the proposed mortgage payment and any other
obligations the applicant may have. The W2's/tax returns are used to ensure that the
applicant's income is stable over the past two years.

Full Doc mortgage applicants are also expected to provide other assets documentations
to show that there are enough reserves after putting the down payment and paying for
necessary closing costs. Common assets documentations are two consecutive monthly
bank statements for the accounts that the funds are held. Other assets can be in the
form of stock securities, 401K, and retirement accounts.










					Registered Mortgage Broker - NYS Banking Department. Loans arranged through third party providers. This is not a commitment to lend. Loan programs subject to change without notification. Equal Housing Opportunity.