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As you move through the loan process, keep the following tips in mind. These will help you better understand the process and help you in closing your loan. As a rule, remember to collect, prepare and submit required documents early in the loan process to help facilitate a faster closing.
1. Avoid making any large purchases or refinancing a loan during the loan process. This may adversely affect your credit score or debt-to-income ratio that originally qualified you for your loan.
2. Obtain a gift letter if you’re receiving a gift of equity for a new property purchase. Make sure this letter is written and executed by the individual providing the funds.
3. Be prepared with insurance quotes to avoid delays in funding. Your lender should provide you with specifications on insurance coverage requirements.
4. Prepare a Year-to-Date Financial Statement (Profit & Loss) to show your business income trends. This applies if you are a sole proprietor or have a new business with no tax history. Be prepared to provide a written explanation of any personal or business income decline or loss.
5. Set an appointment to inspect the subject property. The engaged appraiser will contact you or the seller. This can occur up to one week before the appraisal completion date.
6. Collect the most current tax bill from the tax collector or seller. This is required to escrow for taxes.
7. Provide documentation for Environmental Due Diligence. This applies if your property may have or has had environmental concerns. This includes underground tank removal letter, No Further Action Letter, Phase 1 or Phase 2 Report copies.
Content provided by Commercial Direct®, a division of Bayview Financial Small Business Funding L.L.C.
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