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1003 Application Form: What is listed on a 1003 Form

Sunday, April 20th, 2008

1003 Application Form: What is listed on a 1003 Form

We will most likely do future posts on what a 1003 form is, but we’ll give you a general overview here. A 1003 is basically a financial summary of the borrower applying for a loan. It’s made and approved for Fannie Mae and is the standard form to submit to lenders. It’s kind of the starting point. Many times a loan officer will call you on the phone and ask you financing questions, they are most likely filling this info out on the 1003, either on paper, or on the computer. There are a couple of popular computer programs for loan officers that do 1003 forms and others. Calyx Point is one. They fill out all of the info online and can submit to most lenders. What’s important to you though is that you know the answers to properly fill out a 1003 form. The loan officer will be asking the questions. As of 2008, loan officers have to be licensed to be able to do loans, legislation required it. There may be situations where someone working for a big bank as a w-2 employee under their supervision, it may differ. On a 1003, you are generally going to give out some personal info about yourself. You are going to put where you live, and enter any co-borrower info. You will tell them where the down payment comes from. The next couple of pages generally are pages for assets and liabilities.

Assets are things such as:
Checking account balance
Savings account balance
401k
Roth IRA
Stocks
Bonds
Furniture
Cars
Cash on hand
The goal here is to show the lender that you are a strong borrower. For banks checking, savings, etc you will need to put account #’s, etc. A lot of your information will be verified. You will end up providing info about your job, if you are self-employed, w-2, and taxable income will come up. Real estate owned will also be a section under assets. You can show rental income, equity as you state today’s value and what’s owing.
There will be a section about liabilities, where you will state everything you owe money on. This will include mortage balances on all properties, credit cards, revolving credit, installment loans, furniture loans, auto loans, visa, mastercard, discover, american express, student loans, anything that’s a liability, debt, anything you owe money on.

Both of these sections are needed as it gives the lenders your financing picture, also they will need to determine your debt to income ratio. Generally speaking that’s the ratio of your house payment to your gross income. Many many years ago this number was 25%. It grew to 33% years later. We saw it go to 50-60% DTI (Debt to Income) ratio in the peak of the housing market. Due to losses lenders are starting to be more conservative now and ask for more of a down payment and lower DTI.

The 1003 is just a starting form that the loan officer and you will put together. I will write other articles on the other forms, but it’s many from disclosures, verification of deposits, verification of employment, and many verifying forms. Ther is a lot of behind the scenes stuff done by either a loan officer or his/her processor who handles a lot of that paperwork. All of this paperwork goes together to provide a complete package that is submitted to the lender for approval. Often a title commitment and appraisal can be part of that full package. This post is only about the 1003 for now, so just keep in mind that it’s a standard form, and loan officers will need to get accurate info from you to fill this out.

Email me ron@minnesotainvestors.com if you want to get pre-approved.

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Posts Tagged ‘1003 application form’

1003 Application Form: What is listed on a 1003 Form

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