Mortgage applications are designed to be borrower-friendly and standardized across the mortgage industry. The mortgage application used in all U.S. states and territories for the past 20 years is the Uniform Residential Loan Application (URLA). Here is a breakdown of everything borrowers need to know about URLA and filling it out.
URLA: The Standardized Mortgage Application
URLA is also known as Freddie Mac Form 65 or Fannie Mae Form 1003. This is the standard document used by borrowers to apply for a mortgage loan.
Freddie Mac and Fannie Mae are entities created by Congress to provide liquidity, stability, and affordability in the mortgage market. Freddie Mac and Fannie Mae buy mortgages from lenders and will either hold those mortgages in their own portfolios or repackage them into mortgage-backed securities (MBS) to be sold.
Because all loans need to be compliant with Freddie and Fannie’s guidelines to be saleable on the secondary market, it is recommended that borrowers use their mortgage application, the URLA.
The 7 Sections of the Mortgage Application
The URLA contains all the information a mortgage lender will need to determine if a borrower is worth the risk of funding a loan. There are 7 sections in a URLA application that we wanted to highlight for borrowers:
- Type of Mortgage Loan: In this section, the URLA contains some basic information about the type of mortgage loan the borrower has chosen to take out. If a borrower hasn’t selected a property and a type of loan, they can instead specify the maximum amount they would like to borrow.
- Property Information and Purpose of Loan: Once a borrower finds a property that they want to make an offer on and buy, this section can be filled out. The Property Information and Purpose of Loan section contain information about the property (address, the year it was first constructed, property type, etc.), and clarifies whether the loan is used for the purchase or refinance of the said property.
- Borrower Information: The Borrower Information section asks for identifying information about the borrower and co-borrower. This includes social security number, date of birth, marital status, and contact information.
- Employment Information: Borrowers will need to fill out information about their current employment including the address of their current employer, and previous employers depending on how long they have been at their current job.
- Income and Housing Expenses: The URLA also requires borrowers to disclose their total monthly income and their regular monthly expenses.
- Assets and Liabilities: Borrowers will also need to list any assets – anything that can be used or liquidated to cover loan payments. This can include checking and savings accounts, bonds, stocks, and retirement funds. Additionally, borrowers will need to include any liabilities or debts they have such as student loans, car loans, credit card debt, etc. If a borrower owns additional investment properties or second homes, the URLA also requires that these be disclosed in the assets section.
- Real Estate Transaction Details: At the end of the application will be information on the purchase price the borrower has agreed to pay for the property, the estimated closing costs and any prepaid items for escrow.
The URLA Mortgage application is just one piece of documentation that lenders will use when determining if a borrower qualifies for a mortgage loan. Mortgage applications tend to get filled out at the beginning of the lending process.
At JVM, we assist in completing the loan application for you to ensure all information is accounted for and accurate. It is always recommended that borrowers speak with a lender to answer any questions before they fill out a loan application.
You can contact us with any questions or to get started at (925) 855-4491, or email us at email@example.com.
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