Posted by Jessica Ward on 10/6/11 8:38pm
Msg #399848

1003 Loan app confusion

I've been doing loan closings for four years now, and nary a problem. However, lately I've had an IMPOSSIBLY outrageous number of varying instructions on how to sign the 1003. (It is worth saying, that I've never had a problem, or confusion with this until the last six months).

Married borrowers, jointly, always signing at the top. No problem.
But I've had instructions that non borrowing spouses do and do not sign the top (we are a community property state here)
I've also had the instruction that single borrowers do and do not sign at the top (with the majority of firms saying that a single borrower DOES sign at the top).
I've had varying instructions also on corporately held-properties. Some saying if the property is held in a trust or a corporation (even if the loan is to the individual) that the borrower signs or signs on behalf of the trust, or doesn't sign at all, or signs personally at the top, regardless of how many people are on the transaction.

Now I second-guess this one signature line every time I see it.

Are there hard-and-fast rules on this? I have a suspicion that I am getting bad information from 1-2 clients, which is throwing me off. For now I'm sticking to the "my way" unless otherwise instructed strategy, and nothing has been sent back, but I hate the uncertainty.

Reply by Blueink_TN on 10/6/11 8:47pm
Msg #399851

If both borrowers are listed on the 1003, than they both sign. If not, only the qualifying borrower signs. (Unless the instructions state otherwise.)

Reply by Scriba/NM on 10/7/11 1:50am
Msg #399868

You are absolutely correct n/m

Reply by Shoshana/AZ on 10/6/11 8:51pm
Msg #399852

The instructions I have seen is that if it's a joint app both must sign. If there is only one borrower I don't have him/her sign unless specifically directed to do so.

Reply by MW/VA on 10/6/11 8:53pm
Msg #399853

I always have them sign that top line--single borrower or two borrowers. I understand it's really only supposed to be signed if it's a joint credit app, but I'm not going to try to determine that.
I've never had one kicked back for having the top line signed.

Reply by Jessica Ward on 10/6/11 8:55pm
Msg #399854

Thanks-- Ya'll are ratifying my opinions on the subject.

One SS is saying unless it is joint credit NOBODY signs on the top, and even if it is joint credit, if the property is held in trust, nobody signs on the top line. (I'm almost 100% sure they are wrong about that).

Reply by MW/VA on 10/6/11 9:01pm
Msg #399856

LOL--an ss that wants to play tc & decide how the app.

should be signed. That's a good one!

Reply by Jessica Ward on 10/6/11 9:07pm
Msg #399858

My thoughts exactly! n/m

Reply by JanetK_CA on 10/7/11 2:11am
Msg #399869

Ever since I had a ss INSIST I go back (20+ miles) to have a single borrower sign the top, I always have every borrower sign at the top. If it's a single person or a person with a non-borrowing spouse, I have them put NA on the line by the co-borrower - an idea I got from someone else on this site eons ago, when that piece was newly added to the top of the 1003. Seemed like a good compromise to me. I would NOT, of course, have a non-borrowing spouse sign there.

In recent months, I've also seen instructions from several signing companies listing frequent errors and including that omission as one of them. So I will continue to have every borrower sign at the top.

Reply by SharonMN on 10/7/11 11:38am
Msg #399916

Every company wants something different. If there are specific instructions, I follow them. If not, I have all borrowers sign at top and if only one borrower, I have them put N/A in the co-borrower line. Never had anybody complain.

I wouldn't have the non-borrowing spouse sign the loan app (or the note), though. That would mean they were applying for credit.

Reply by Linda_in_MI on 10/7/11 12:05pm
Msg #399917

Re: 1003 Loan app confusion-not just the top

I have had a couple of refis recently where the 1003 had the customary signatures at the top AND also required full signatures at the bottom. No initials, but signatures. And this on all pages.

Reply by Jessica Ward on 10/7/11 4:42pm
Msg #399936

full signatures on all pages? What a pain! n/m

Reply by GY_CT on 10/7/11 6:26pm
Msg #399948

When the current 1003's were introduced several years ago, with the borrower sigs at the top of page one, the general rule was the sigs were required only if there was more than one borrower. Seemed odd, but that's the way they played it. Not long after, they changed that rule and had even the sole borrower sign. That makes more sense. I haven't experienced anyone reverting to the former rule since then.

But never have a non-borrowing spouse sign the loan app. The non-borrowing spouse shouldn't even be on the loan app. If I saw a non-borrowing spouse on a loan app, I'd check before proceeding.

I don't know how Washington state laws alter this. Check with a few reputable real estate attorneys. They should be happy to help you. State Attny General's office could also help. It's always possible (!) that you've been getting bad advice.