Common Mortgage Forms and Their Purposes

Key Mortgage Forms

Here's a guide to some of the most commonly used forms during the mortgage process, along with their purposes:

Uniform Residential Loan Application (Form 1003)

This is the standard form used by borrowers to apply for a mortgage. It requires detailed information about the borrower's finances, including income, assets, liabilities, and more.

Loan Estimate

Provided by the lender, this form offers an estimate of the loan terms, including interest rate, monthly payments, and closing costs. It helps borrowers compare offers from different lenders.

Closing Disclosure

This form outlines the final terms of the loan. It provides detailed information about the mortgage loan, including the interest rate, monthly payments, and total cost over the life of the loan.

Mortgage Note

This legal document binds the borrower to repay the mortgage. It specifies the loan amount, interest rate, payment dates, and other terms of the loan.

Deed of Trust/Mortgage

This document secures the note and gives the lender a claim against the home if the borrower fails to meet the terms of the mortgage note.

Title Insurance Policy

This policy protects the lender and/or borrower against any losses due to disputes over the ownership of the property.

Homeowners Insurance Policy

Required by lenders, this insurance covers potential damage to the property, protecting both the homeowner and the lender.

Appraisal Report Forms

Appraisal reports are critical in the mortgage process, determining the value of the property. Here are common forms used:

Uniform Residential Appraisal Report (Form 1004)

This is the most common form used for single-family residential properties. It includes an analysis of the property and neighborhood, a valuation based on comparable sales, and a replacement cost analysis.

Individual Condominium Unit Appraisal Report (Form 1073)

Specifically used for condominium units, this report includes details on the condo project, including its operations, and compares the unit to similar properties.

Exterior-Only Inspection Residential Appraisal Report (Form 2055)

Used for lower-risk loan refinancing, this report involves an exterior inspection of the property, offering a quicker and often less expensive appraisal option.

Small Residential Income Property Appraisal Report (Form 1025)

This form is for small residential income properties (2-4 units). It assesses the rental market and income potential, along with the standard property valuation.

Understanding these forms and reports can provide a clearer view of the mortgage process and property valuation methods.