Historically, most housing loans in the early s in the USA were short term mortgage loans with balloon payments. To address this, Fannie Mae was established by the U. As such, Ginnie Mae is the only home-loan agency explicitly backed by the full faith and credit of the United States government. Ginnie Mae had guaranteed the first mortgage passthrough security of an approved lender in  and in Freddie Mac issued its first mortgage passthrough, called a participation certificate, composed primarily of private mortgage loans.
|Published (Last):||19 November 2010|
|PDF File Size:||3.63 Mb|
|ePub File Size:||10.42 Mb|
|Price:||Free* [*Free Regsitration Required]|
Fannie Mae Form is a loan application form designed by Fannie Mae and Freddie Mac that is used by lenders to obtain financial and personal information from borrowers who apply for a mortgage loan secured by a one to four unit residential real estate.
Form is widely adopted by mortgage lenders as a standard loan application form. It is generally referred to as Form , or just and pronounced as "ten-o-three". Freddie Mac also uses the same application form and is known as the Freddie Mac Form Initial and Final Form is filled at two times during the loan process.
Form is first completed at the time of making a loan application and this form is generally referred to as "Initial ". Initial helps establish the date of application, permissible purpose for obtaining credit report, and intent of borrowers to make a joint application.
The initial may be completed by the borrower or by the loan originator on behalf of the borrower. However, the initial Form should be signed by each borrower. For applications taken over phone, the loan originator may complete the application form and then send the completed form to the borrower for signature. For applications taken through the Internet, the lender may obtain an electronic signature or send a printed copy to the borrower for signature. The second Form is prepared at the time of loan closing.
This is generally referred to as "Final " and is prepared by the lender. The purpose of Final is to have the borrower confirm the loan application information after all the details have been verified by the lender. Source :www. Therefore, the final has the income, asset, and employment information that the lender verified and used for underwriting purposes.
Section II — Property Information and Purpose of Loan: This section contains information relating to the property that will be used as collateral for the loan. The loan purpose and title information is also entered.
Part-time, temporary, and seasonal jobs held in last two years should also be entered. The second set of information is the Combined Monthly Housing Expense information which determines the current cost of housing expense. Section VI — Assets and Liabilities: The information relating to all the assets and liabilities of the borrowers is entered here. The section also requires detailed information of any real estate owned by the borrowers in the Scheduled of Real Estate Owned.
Section VIII — Declarations: Declarations related to past credit, current residency status, purpose of residence, and other declarations are made. Certain sections may require the borrowers to provide detailed explanations. Section IX — Acknowledgement and Agreement: The borrowers provide acknowledgment to various disclosures and affirmations. The section also contains additional information that the loan originator needs to enter.
Agency Requirement: Fannie Mae and Freddie Mac require lenders to the use of Form for all loans that are sold to them. Since lenders sell a large number of loans to Fannie Mae and Freddie Mac, it is much easier to implement the Form for all loans instead of having different forms for agency and non-agency loans. Simplifies Technology Development and Implementation: Most of the loan origination software systems have support for the Form , including the ability to transmit the loan application electronically.
Building customized application form entails additional costs. Widely Understood: Form is widely used and understood by the industry which makes it easier to sell or transfer loans. This is especially useful when mortgage brokers are trying to shop at different lenders to obtain the best deal.
They can simply take the same application form and submit to different lenders and not worry about filling different forms for each lender. However, no regulation specifically requires the use of Form The lenders are free to use an alternate form as long as it is consistent regulatory requirements.
Any discrepancy in the income, employment, or asset information should be investigated and verified through independent sources. Internal audit, compliance, and risk management department would form the final layer of reviews to ensure that the form is being correctly completed. Recordkeeping Form is a vital document for a loan file and is used to demonstrate compliance with various regulations such as Regulation C, Regulation B, and Regulation X. Therefore, Form should be kept with the loan file for as long as the loan is outstanding.
For cancelled, declined, or withdrawn loan the Form should be maintained for at least 25 months after the date when the decline notice was sent. This will meet the recordkeeping requirements of Regulation B.
Aly J. Also called the Uniform Residential Loan Application, Form is the standard application form used by most mortgage lenders in the U. What Is the Mortgage Application Form? Its Freddie Mac equivalent is Form Both forms are based on the Uniform Loan Application Dataset and require the same information from consumers upon applying for a residential mortgage loan. Both Form and Form 65 were recently redesigned, though these updated forms have yet to go into use just yet. Who Must Use Form ?
The 1003 Mortgage Application Form
By Claire Boyte-White Updated Oct 27, The mortgage application form is the industry standard form used by nearly all mortgage lenders in the United States. This basic form, or its equivalent, is completed by a borrower when applying for a mortgage loan. While some lenders may use alternative forms or simply accept basic borrower information about their identity, property type, and value, the vast majority of lenders rely on the form. Generally, the form is completed twice during a mortgage transaction: once during the initial application, and again at closing to confirm the terms of the loan. Some lenders allow borrowers to complete the form at home, while others assist borrowers in person or over the phone. In either case, a potential borrower should understand the format and the information required before completing the form.
What is Fannie Mae Form 1003?