The time has come for you to buy a new property. If you’re like most buyers, you’ll probably need to apply for a mortgage loan to finance the property. During this process, you’ll more than likely encounter the new Uniform Residential Loan Application Form (URLA or Form 1003).

This form may seem intimidating at first glance with all the information you have to fill out and supply. Luckily, we’ve prepared this guide for you to navigate Form 1003 to make the process a bit easier.

What is the Uniform Residential Loan Application (URLA or Form 1003)?

The 1003 mortgage application form is the standard industry form used by nearly all of the mortgage lenders in the United States. As such, you’ll probably have to complete this form when applying for a mortgage loan.

Typically, you’ll have to complete the application form twice during a mortgage transaction. The first is when you apply for the mortgage loan, and the second is when you confirm the terms of the loan. While some lenders allow borrowers to complete the form at home, or online others assist borrowers to complete the form over the phone. No matter how you complete the form, you should understand the 1003 format and the information needed before completing the form. 

How has Form 1003 changed?

From 1003 was recently redesigned to address developments in the property and the mortgage industry, GSE policy, and the Home Mortgage Disclosure Act reporting requirements. While the overall loan application process hasn’t changed, the form asks for more information, all with a cleaner look and feel and clearer instructions.

Both the redesigned form and the implementation of a new automated underwriting system promise to streamline the application process and improve lender decision-making during the consideration phase. This all redefines the mortgage experience and makes it more digital, and more efficient.

How do these changes affect clients and realtors?

Before implementing the new improvements to the form, clients and realtors often had to jump around in the form to complete different sections. With the changes, the data fields have been methodically rearranged to flow better and every section has been organized to request all borrower information in one section. Although this makes the form much longer, it’s simpler and clearer which makes it easier for clients and realtors to complete.      

Navigating the New Form

The following section will give you a broad overview of the information required by Form 1003.

Section 1. Borrower information

In this section of the form, you’ll provide your personal information, as well as your income and employment information. 

You’ll also have to indicate whether you’re applying for a mortgage loan as the only borrower or if you’re applying for joint credit with another borrower. If you are, you should indicate the number of borrowers. It’s important to keep in mind that, in this case, every borrower will have to complete an application form. 

You also must provide full information on your address and indicate whether you own the home where you live or whether you’re renting the home. 

In respect of your employment, you’ll have to state the name of your employer, the name of the business that you own, or your name if you are self-employed and do not operate under a business name. Like your personal details, you’ll have to provide the contact details of your employer or your business.

It’s also necessary to provide full details of all the income you receive from your employer or from your business, and you’ll also have to provide details of any other income you earn, which is not related to your employment.

Section 2. Financial information – assets and liabilities

Here, you’ll have to enter information about each of your asset accounts as well as the current value of each account. You’ll also have to supply details of the credits you’ll receive toward the property purchased like earnest money, employer assistance, relocation funds, rent credit, or trade equity if applicable.

In respect of liabilities, you’ll have to set out all the personal debt you have or will have by the time the mortgage loan closes including debts that are not on your credit report, debts with payments that are deferred, and debts that will be paid off before closing.

Here, you don’t have to include any household expenses like phones, utilities, or insurance unless your lender requests you to do so.

Section 3: Financial Information – Real Estate

In this section, you’ll have to provide details of every property you own and/or for which you are obligated on a mortgage. So, if this is a refinance transaction, you’ll list the property you are refinancing first. You’ll also have to provide details on every property’s associated mortgage, including the account number, monthly payment, unpaid balance, and credit limit.   

In addition, in respect of every property, you’ll have to provide details regarding:

• Property value
• Whether the property is sold or whether you’re intending to keep it
• The intended use
• Monthly insurance
• Taxes
• Monthly rental income   

Section 4: Loan and Property Information

In this section, you must indicate the loan amount that you’re applying for as well as the purpose of the loan. So, you’ll have to indicate whether the loan will be used to purchase a property or refinance a current property. 

This section also requires full details of the property you’re financing, and you’ll have to indicate:

• Address
• The estimated value of the property
• Occupancy, whether it will be your primary residence, second home, or an investment property

Section 5: Declarations

In this section, you’ll declare whether:

• You’re borrowing or obtaining any money from another party for the real estate transaction that you have not disclosed in the application.
• You have or will be applying for a mortgage loan on another property on or before closing the transaction that is not disclosed in the application.
• Whether the property will be subject to a lien that could take priority over the first mortgage lien. 
• You are a co-signer or guarantor on any debt or loan that’s not disclosed in the application.
• You are currently a delinquent or in default of federal debt.
• Whether you were on the title where a property was conveyed through a deed in lieu of foreclosure in the past seven years.
• You have declared bankruptcy in the past seven years.    

Section 6: Acknowledgements and Agreements

In this section, you’ll have to read the entire section and acknowledge that you have read it and agree with its terms by signing it. If there is an additional borrower, that borrower will need to do the same. It’s important to ask the lender if you have any questions about the language in the section or if there are any parts you don’t understand.

Additional Sections

The form also contains several additional sections that relate to military service that should be completed when necessary, demographic information, and the loan originator’s information.

Documents Required

In addition to completing the form, you’ll also have to provide the lender with a variety of documentation to support your application and to enable them to properly consider it. 

So, make sure that you have the following documents on hand when applying for the loan:

• Two recent pay stubs. 
• The purchase offer or sales contract in respect of the sale of the property.
• Your Social Security card and state ID like your driver’s license.
• A copy of your most recent mortgage bill.
• Your most recent banking account statements.
• Statements for any IRAs, 401(k)s, or retirement accounts in your name.
• Recent credit card and vehicle loan statements.
• Policy document for any life insurance policies in your name.
• Data on any real estate that you currently own.
• Your tax returns and W-2 forms for the previous two years.

Apart from your lender needing these documents, they’ll also make it easier for you to complete the application form when you need all the details. 

A and N Can Help Navigate the New Form 1003

If you look at all these sections you need to complete, Form 1003 certainly seems imposing and complicated. If you work through it systematically, with the required documents in hand, it shouldn’t be a problem. There may, however, still be times when you need some advice or have questions.

Luckily, we’re here to help. If you’re ready to embark on your home buying journey, A and N can help you navigate the new Form 1003. Our team of professionals can effectively guide you through the questions you need to answer and find the mortgage solution that’s best for you. Contact us today to speak with a knowledgeable mortgage consultant!

A and N Mortgage Services Inc, a mortgage banker in Chicago, IL provides you with high-quality home loan programs, including FHA home loans, tailored to fit your unique situation with some of the most competitive rates in the nation. Whether you are a first-time homebuyer, relocating to a new job, or buying an investment property, our expert team will help you use your new mortgage as a smart financial tool.