In an effort to improve the mortgage loan application process, Fannie Mae and Freddie Mac (under the direction of the Federal Housing Finance Agency (FHFA)) have significantly redesigned the standard home loan application form. This new form, known as the Uniform Residential Loan Application (URLA), will be adopted by lenders as soon as July 1, 2019. By February 1, 2020, it will be required for all lenders to use.
Why the change?
The truth is that the forms still being used haven’t had any significant changes in the past 20 years. Obviously, the housing market, technology and other things have evolved since the turn of the millennium, so it was about time for the mortgage application forms to have some major updates. Some changes are strategic while others are more aesthetic. The goal is to make the form easier for borrowers to understand and fill out, while also helping streamline the review and approval processes for lenders.
“The redesigned URLA takes a design thinking approach,” says John Haring, Director of Product Management at Ellie Mae, “with dynamic field collecting and a presentation of data tailored to the individual borrower and loan scenario. The goal is to provide greater efficiency, transparency and certainty for future homebuyers applying for mortgage loans and greater consistency for lenders who sell to both Fannie Mae and Freddie Mac.”
Transparency in Lending
Efficiency, transparency and certainty are three words I like to hear when it comes to the mortgage application process. Improving transparency in lending is especially important to us here at Transparent Mortgage. After all, that’s where I got the name. I’m in favor of anything that will help make the experience better on both sides of the deal. Borrowers will understand the application better and our loan underwriters will have all the information they really need to pre-approve loans. An efficient and effective pre-approval stage ultimately makes the final mortgage loan approval process go as smoothly as possible.
Preparing for Your Future
I think its about time to update the application forms and take one more step to improve the lending process for everyone involved. You can check out a sample of the new Uniform Residential Loan Application form on fanniemae.com. If you are considering buying a home in the next few years, it’s a good idea to familiarize yourself with the information you will need to provide. Even if you are applying sooner, most of the information is the same. This form should just help make things better for the industry moving forward.
For any mortgage questions you have, call Transparent Mortgage today at (619) 929-0199.