Thank you for choosing Community Mortgage Solutions for your financing. We will do all we can to make this transaction as smooth as possible. To help you with understanding the loan process we have compiled the following information.

Why use a mortgage broker? Mortgage brokers have a wide variety of loan programs and lenders to choose from. This allows us to give you the best deal for your individual situation. Local banks generally have strict guidelines, which leads to a lot of restrictions. Brokers have options! You can compare a mortgage broker to a large grocery/retail store, and a bank to a convenience store.

Your Application: This will contain all the information needed to get a loan approval. Please be very specific with all information provided. With most loan programs, we will need to provide proof of all information stated on your application. At this time, and with your approval, we will contact the credit bureaus for your credit report. This will complete the application.

Pre-Approval: We will review your completed application and submit it to the lenders that will give us the best mortgage terms for your needs. Pre-approvals can sometimes take up to 48 hours. When a pre-approval is given, it will be given with conditions. If the conditions can be satisfied, the loan will be approved.

Checklist: We will provide you with a list of items that most lenders will require in order to close your loan. Please return all required information and/or documentation to our office within 48 hours. Your cooperation will help us to complete our task and close your loan in a timely manner. If you have a problem obtaining any information and/or documentation, please let us know immediately.

Behind The Scenes: We will be contacting your employers, banks, mortgage companies, landlords and/or others to verify information you have provided on your loan application. Some verifications could take up to two weeks.

Fees & Closing Costs: All fees and loan related costs will be listed on your Good Faith Estimate.

Services: (1) We will be working with your realtor throughout the loan process. We will keep them updated on a regular basis. (2) We will order an appraisal, which could take up to two weeks to complete. The appraisal will determine the market value of the property. (3) We will order a survey of the land, if necessary. If you are purchasing an existing home, most likely a survey has already been completed. If there is no survey, it may take up to two weeks to have one completed. (4) Title work is ordered. This is basically a background check on the property. The title company will make sure that there are no liens on the property and will also check the history of the property.

The Lender Package: Once all information has been compiled, it will be over-nighted to the lender. They will take up to 48-72 hours to review your file. Upon review, we will receive either an approval or approval with conditions. If more information needed, we will submit it to the lender by fax or e-mail. They will then take another 48-72 hours to review everything and give a final approval.

Loan Approval: The loan approval is given and a loan commitment is made. The lender will provide the title company with all closing documents within 48 hours of approval. The title company will contact you to schedule a closing date and time. They will also provide you with the final amount of funds you will need to bring to the closing, which should be in the form of cashier’s check, made payable to the title company.

Delays In Closing: Most closing delays will cost our borrowers some money. You can be charged for contract extensions, and interest rate lock extensions. In some cases, you may even lose the opportunity to purchase the home. Rates are only locked in for a certain period of time. There are many other people involved in a real estate transaction, and therefore there are some areas that we cannot control.

Locking Your Interest Rate: Most lenders have a 30 day lock period. This means that if we lock your rate interest rate on the first of the month, we will have until the 30 th of the month to close the loan at that rate.

Escrow: This is money collected by the lender on a monthly basis (calculated into your monthly mortgage payment), which allows the lender to pay your homeowners insurance and property taxes. In most cases if your loan to value is above 80%, you will be required to escrow. For example:

Principal & Interest $800.00

Homeowners Insurance Escrow $ 50.00

Escrow for Property Taxes $ 50.00

TOTAL MONTHLY PAYMENT $900.00

If you have the option to waive escrow, you may be charged with a fee or given a higher interest rate. If you choose to waive escrow, this means that you will be responsible to pay your homeowners insurance and property taxes directly on a yearly basis.

Refinancing: There will be a 3 day Right of Rescission with this type of loan, which means that you will not have access to your funds until the fourth day after closing the loan.

Private Mortgage Insurance (PMI): Private mortgage insurance is required if you are putting down less than 20% of the sales price. Once your loan to value drops below 80%, the mortgage insurance should be removed from your monthly payment. You may want to re-appraise your home within the next year or two if you see property values increasing in your area. Send the new appraisal to your lender and they should remove the mortgage insurance. PMI will be calculated into your monthly mortgage payment.

Truth-In-Lending: This ensures disclosure of credit costs by lenders and mortgage brokers, including the disclosure of all fees and charges associated with a loan, but separate from the quoted interest rate.

Helpful Hints: All of the following can effect your loan approval:

• Do not make any major purchases, i.e. cars, appliances – nothing over $1,000.
• Do not let too many companies pull your credit. Each inquiry could cause a drop in your credit score and change your loan approval.
• Do not change your employment.
• Do not stop paying your current mortgage or rent while waiting to close on the new loan
• Do not move money from many different accounts. If you must move money, make sure you are able to track the funds.

The entire loan process may take anywhere from 15 to 30 days. Your cooperation is a must to accomplish this task! Of course, we are always here to help. Please contact us right away if you should have any questions at all about your loan.