Getting a Mortgage | Baltimore First Time Home Buyer

Getting a Mortgage  |  Baltimore First Time Home Buyer

by Helene Kelbaugh of Keller Williams Realty in Baltimore

Why so much paperwork for getting an Mortgage?

Why is there so much paperwork mandated by the bank for a mortgage loan application when buying a home today and getting a mortgage? It seems that the bank needs to know everything about us and requires three separate sources to validate each and every entry on the application form. Many buyers are being told by friends and family that the process was a hundred times easier when they bought their home ten to twenty years ago.

There are two very good reasons that the loan process is much more onerous on today’s buyer than perhaps any time in history.

1. The government has set new guidelines that now demand that the bank prove beyond any doubt that you are indeed capable of paying the mortgage.

During the run-up in the housing market, many people ‘qualified’ for mortgages that they could never pay back. This led to millions of families losing their home. The government wants to make sure this can’t happen again.

2. The banks don’t want to be in the real estate business.
Over the last seven years, banks were forced to take on the responsibility of liquidating millions of foreclosures and also negotiating another million+ short sales. Just like the government, they don’t want more foreclosures. For that reason, they need to double (maybe even triple) check everything on the application.

However, there is some good news in the situation.
The housing crash that mandated that banks be extremely strict on paperwork requirements also allowed you to get a mortgage interest rate probably below 5%.
The friends and family who bought homes ten or twenty ago experienced a simpler mortgage application process but also paid a higher interest rate (the average 30 year fixed rate mortgage was 8.12% in the 1990’s and 6.29% in the 2000’s).
If you went to the bank and offered to pay 7% instead of

The Value of Getting A Mortgage

Bottom Line
Instead of concentrating on the additional paperwork required, let’s be thankful that we are able to buy a home at historically low rates.

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Next Steps

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David Shamansky
US Mortgages - David Shamansky - Highlands Ranch, CO
Creative, Aggressive & 560 FICO - OK, Colorado Mtg

Aside from trying to make amends for the debacle from early to mid 2000's the bottom line is youa re getting several hundred THOUSAND dollars for taking some time and filling out some paperwork and providing some supporting documents so all in all not a bad deal

Oct 14, 2014 12:12 PM #2
Winston Heverly
Winston Realty, Inc. - Atlantis, FL

Helene,  I enjoyed your read today, great information with a super guideline of instruction.

Oct 14, 2014 12:45 PM #3
Florida Tolbert Team Keller Williams Advantage
Keller Williams Advantage III Realty in Lake Nona - Orlando, FL
Keller Williams Land Luxury Division Specialist

we  just did our  first mortgage as almost husband and wife and after nearly 20 minutes of signing, we just completed the application.  This is not even the closing yet.

Oct 14, 2014 12:59 PM #4
Helene Kelbaugh, REALTOR, Internet Marketing Specialist
eXp Realty - Middle River, MD
eXp Realty

Preparing buyers is key.  Now if only I could get a "signature stamp" as gift for buyers lol  :)   Congrats Kevin!!!  

Oct 14, 2014 01:12 PM #5
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Helene Kelbaugh, REALTOR, Internet Marketing Specialist

eXp Realty
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