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Application Process
What's the first thing I should do if
I want to get a WHEDA Home mortgage loan to buy a house?
The first thing to do is talk to a residential loan officer at a bank, savings bank, credit union, or mortgage banker. The loan officer will ask you questions about your financial situation, credit and employment histories, and will be able to tell you whether you're a good candidate for a WHEDA Home Loan. Also, the loan officer can tell you the price range of the houses you can afford. How long does the process take? Your lender will need 2-4 weeks to gather all the necessary information. The entire application package is then sent to WHEDA, where the approval process will take no more than one day. If your employment or credit situation is unusual, your application may take more time. If the application package is incomplete when it is submitted to WHEDA, it may also take more time. To be safe, you should figure 4-6 weeks until closing, and stay in touch with your lender to see if s/he needs any other information from you. Your lender will request (and you will pay for) a credit report from a local credit-reporting bureau. You'll be asked to explain in writing any problems that show up on your report. While some late payments can be understood, a pattern of not paying on time will probably be a problem. In some cases, you may be required to make a larger down payment. If you've ever had a judgment filed against you by a creditor, you'll have to provide written proof that it's been satisfied. You should also provide a written statement explaining why the judgment or lien was filed. If you've declared bankruptcy in the past, WHEDA will consider making the loan if the bankruptcy was discharged at least four years ago and you've re-established good credit. Who decides how much I can afford to
spend on a house? Your loan officer will tell you how much you can afford to borrow, and from there you can determine a price range. This is based on your income, your down payment, other debts you may have, and your credit history. The rule of thumb is that you shouldn't pay more than 28% of your gross monthly income for house payments (including loan payments, property taxes, hazard insurance, and primary mortgage insurance). Your total monthly debts (including house payments and other debt) shouldn't be greater than 36%. These percentages are called your "housing ratio" and "total debt ratio." To help you estimate how much house you can afford, you can use WHEDA's mortgage calculator. These are guidelines, not hard-and-fast rules. You should discuss your own situation with your lender. What information will my lender need? Your lender will need:
Based upon your particular situation, your lender may ask for more information. I don't have my tax returns for the
last three years. What do I need to do? You can get copies of your tax returns by writing to: IRS Dept. of Treasury You can also call the IRS at 1-800-829-1040 Ask for the RTFTP Form. Your information will be mailed within 15 business days.
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