Posted by Butch on June 26, 2001 at 23:24:24:
Amy, i am “brand new” to even the prospect of REI, but I am looking forward to learning with you, I will also post often, as I learn.
Good Luck!
Butch(in Houston)
For Beginners! But Pros!.. Please Respond! - Posted by AmyDLTX
Posted by AmyDLTX on June 26, 2001 at 18:55:05:
Hi everyone!
Okay, for those experienced movers and shakers of real estate investment, this is very simple, and probably uncalled for. You already know whats in a loan package and more. My intention was not to teach but to learn from you. Whether I am on my way to work, to a friends, or just to the grocery store, I still get excited every time I see a “For Sale By Owner” sign and I remember what I’m suppose to say when I knock on the door or call the number.
Please tell me what the difference is between what I see every day in the files I handle at work, and the documents that I should be familiarizing myself with, if any.
I have studied this site in the past and I haven’t been here in a good while for I just didn’t understand the process of buying and selling real estate from a financial stand point ONLY.
Now, I think I’m learning something… thanks to a job I just received at a well known bank in my area, in the Mortgage / Correspondent Lending Department. I didn’t understand what it would take to put a loan package together in order to purchase, or refinance a home when the time came, until I landed this job. Now I know what a “Note” and an “Assignment” and a “Closing Agreement” looks like. I don’t know if these documents, as well as the rest of the loan package has anything to do with Creative Real Estate, but I was grateful for the priviledge of seeing these documents for the first time.
If your a beginner as I STILL am, this may be very important information to you too!
This is what I have learned…
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Of course, there is the loan application. The application offers two sections. One for you the borrower, and the other for the co-borrower (if any). The co-borrower is your spouse, relative, roomate, or whom ever under the age of 18 that will live in the home and share expenses.
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Both borrower and co-borrower (if any), will need proof of employment like photo copies of payroll checks, tax return statements or financial statements if you have your own business, bank statements, any child support or alimony payments you or your co-borrower (if any) may be receiving or paying, credit reports and all outstanding balances that you or co-borrower (if any) owes.
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I have seen photo copies of drivers license, or photo I.D.'s of both borrower and co-borrower, divorce decrees, marriage licenses, social security cards, something called a signature/name affidavit, and a legal description of the property.
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The “Meat” of these loan packages I think is the Application, Settlement Statement, Note, Mortgage or Deed of Trust, the Assignment to the Deed, any Riders or Addendums to the Deed or Mortgage, a photo and/or a map, or blue print of the property, photos of similar houses within the block,… and if you were to use an attorney in the purchase, there would be a Power of Attorney Agreement, and Closing Documents.
I think I have remembered all that is apart of the loan package. I also don’t know that it has any thing to do creative real estate, but for me this was an eye-opener and I wanted to share it with you… the beginner. I’m learning all that I can and will continue to share what I learn with you, until all of us beginners are more comfortable with ourselves in dealing with other peoples money to buy and sell real estate creatively.
Feed back from all the pros would be appreciated. Is there a course you could refer me to that would outline and elaborate on each of the above documents?
Or, maybe I’ll never get the concept of creative real estate and that would be a real shame.
Re: For Beginners! But Pros!.. Please Respond! - Posted by SueC
Posted by SueC on June 27, 2001 at 02:18:28:
Amy, I saw the first time you posted this but it wasn’t clear that there was a question in there.
It’s always helpful to know what’s in a loan package, but generally you won’t be responsible for the details of putting that together, your lender will tell you what they need. You will review them of course, and you will need to fill out forms if you are looking for financing, but generally your loan officer will give you the paperwork that they need. For example some loans are “no doc” where there is much less documentation needed, so the paperwork on the loan end will differ depending on who is doing your loan. It’s not a primary concern to the investor - however, you will need to have a good mortgage broker to help your buyer buy from you, an knowing what kind of hoops they will jump through is helpful. But you won’t have those forms on hand to ave anyone fill out. Your lender provides them.
The docs you’ll be concerned with primarily as an investor are the purchase agreement and the terms you want in there, or the lease/option agreement terms, and/or other docs showing your agreement with the seller and also with the buyer. You won’t need to fill out mortgage application paperwork until you get a loan - and hopefully, as a creative investor, you won’t be getting any loans from banks!