Federal Law requires all lenders to investigate whether or not each home they finance is in a special flood hazard area as defined by FEMA, the Federal Emergency Management Agency. Floods happen anytime, anywhere. The Flood Disaster Protection Act of 1973 and the National Flood Insurance Reform Act of 1994 help to ensure you will be protected from financial losses caused by flooding if you have a flood insurance policy.

Both a home inspection and an appraisal are designed to protect you against potential issues with your new home. Although they have totally different purposes, it makes the most sense to rely on each to help confirm you have found the perfect home.

The appraiser will make note of obvious construction problems such as termite damage, dry rot or leaking roofs or basements. Other obvious interior or exterior damage which could affect the salability of the property will also be reported.

Since the value and marketability of condominium properties is dependent on items that do not apply to single-family homes, there are some additional steps which must be taken to determine if condominiums meet our guidelines.

As soon as we receive your appraisal, we'll update your loan with the estimated value of the home. We will promptly give you a copy of any appraisal, even if your loan does not close.

In addition to verifying your home's value supports your loan request, we will also verify your home is as marketable as others in the area. We will want to be confident if you decide to sell your home, it will be as easy to market as other homes in the area.

While we certainly do not expect you to default under the terms of your loan and a forced sale will be necessary, as the lender, we will need to make sure that if a sale is necessary, it will not be difficult to find another buyer.

To determine the value of the property you are purchasing or refinancing, an appraisal will be required. An appraisal report is a written description and estimate of the value of the property. National standards govern not only the format for the appraisal; they also specify the appraiser's qualifications and credentials. In addition, most states now have licensing requirements for appraisers evaluating properties located within their states.

An installment debt is a loan you make payments on, such as an auto loan, a student loan or a debt consolidation loan. Do not include payments on other living expenses, such as insurance costs or medical bill payments. We will include any installment debts having 10 or more months remaining when determining your qualifications for this mortgage.

If you have had a bankruptcy or foreclosure in the past, it may affect your ability to get a new mortgage. Unless the bankruptcy or foreclosure was caused by situations beyond your control, we will generally require two to four years have passed since the bankruptcy or foreclosure. Equally important is your ability to re-establish an acceptable credit history with new loans or credit cards.

Any student loan which will go into repayment within the next six months should be included in the application. If you are not sure exactly what the monthly payment will be at this time, enter an estimated amount.

If other student loans are reflected on your final credit report, which will not go into repayment in the next six months, we may need to ask you for verification that repayment will not be required during this time period.

Generally, a co-signed debt is considered when determining your qualifications for a mortgage. If the co-signed debt does not affect your ability to obtain a new mortgage we will leave it at that. However, if it does make a difference, we can ignore the monthly payment of the co-signed debt if you can provide verification the other person responsible for the debt has made the required payments, by obtaining copies of their cancelled checks for the last six months.