Yes. A co-borrower is traditionally a spouse or partner whose income and assets are used to qualify for the loan. Co-borrowers are listed on the title and are on the hook for paying the mortgage.
Yes. A co-applicant is any additional borrower following the addition of a co-borrower (third, fourth etc.) Co-applicants are listed on the title and are on the hook for paying the mortgage.
If you'd like to add additional co-applicants, please contact Ally Home Loans before applying. You can reach us at 1-855-256-2559 from Monday – Friday, 8 am – 10 pm and Saturday 10 am – 4 pm ET.
Yes. Before applying, there are a few best practices we recommend.
Maintain and document a stable and consistent income for 2 years in the same business
Keep your business and personal finances separate
Have 2 months' worth of bank statements to show for your down payment (to show your money is stable and not coming from any larger transfers or deposits)
Every situation is different, but it usually takes anywhere from a few weeks to a few months to go from application to closing. To learn more about what to expect in each part of the home loan process, see how it works.
Every situation is different, but when we review your home loan application, we look at your:
Credit score. This is determined by things like payment history and how long you've had credit. Your score is one of a few factors we’ll use to figure out how likely you are to pay back your loan and what interest rate you'll get.
Debt-to-income ratio. This percentage is your total monthly expenses divided by your gross monthly income.
Down payment. This is the amount paid up front when you purchase a home and isn't part of the loan. The amount you put down plays a part in which home loan type you qualify for and whether or not you’ll need mortgage insurance.
Employment history. We want to make sure you’ll be able to afford your home, so proof of income is important.
Not always. Sometimes lenders will keep your loan and you can pay them directly each month, but it's not uncommon for them to sell the servicing rights to a loan after you close. This frees up credit lines and enables them to lend money to other borrowers.
When you get a home loan with us, we'll let you know within 15 days of closing who will be servicing your loan and where to make future payments. While you won’t be paying us directly, the terms of your loan won’t ever change and you can always reach out to us if you have any questions.
This document provides you with important information, including the estimated interest rate, monthly payment, and total closing costs for the loan. It also gives you information about the estimated costs of taxes and insurance, and how the interest rate and payments may change in the future. Lenders are required to provide you with a Loan Estimate within 3 business days of receiving your completed loan application. We'll provide your Loan Estimate instantly online following your application if it’s approved.
This is when we look at everything you've sent us and make a final decision on your loan. It usually takes 2-3 weeks to make sure your documents are accurate and your application is complete. Your home loan expert will provide an update every few days so you always know where your loan stands.
Private mortgage insurance (PMI) is a part of the loan payment and protects the lender if a borrower defaults on a home loan. If applicable, this charge can be viewed on the first page of your Loan Estimate under projected payments. You may be required to pay PMI if your down payment is less than 20%. That being said, PMI is automatically terminated when your principal balance is scheduled to reach 78% of your home's value or the month following the midpoint of your amortization schedule, whichever occurs first.
Since every loan is different, we won't have a complete list of documents needed until further along in the process, but we'll usually ask for copies of your:
Most recent pay stubs
Employment records
Bank statements
Tax returns
Other documents we may need:
Letter of explanation for gaps in employment greater than 30 days
Proof of other income or assets
Divorce decree/separation agreement
Proof of all judgements/liens have been paid in full
Once you've completed your application process, you'll be prompted to send your pre-approval letter to your real estate agent. You can also choose to keep your agent up to date on your major mortgage milestone by providing their contact information after the pre-approval process.
