PLEASE NOTE, AFTER FEBRUARY 28TH 2011, THE LOAN STATUS REPORT AS WE KNOW IT WILL NO LONGER BE A REQUIRED PART OF THE ARIZONA RESIDENTIAL PURCHASE CONTRACT. IT IS BEING REPLACED BY THE NEW PRE-QUALIFICATION FORM.
Download a FREE copy of the LSR at the bottom of this page...
The Arizona Purchase Contract requires the inclusion of what's knows as the LSR or Loan Status Report. This is a single page document that you and your lender will need to complete and sign. Without the LSR, there would be no way for the seller of real property to know that the potential buyer's offer is legitimate. If you as a buyer are unable to show that you are able to secure financing for the home that you are attempting to buy, then many people will be involved in a time consuming process. Making an offer on a property is a serious proposition and should not be taken lightly.
Basically, the LSR states that:
"the buyer submits the following loan status report for a particular property and intends to obtain a loan for "X" amount of dollars."
The LSR also defines some of the loan terms, the type of loan such as Conventional, FHA, or VA, they type of property and occupancy, and the information provided by the lender.
The lender prequalification section has 4 levels of qualification:
- Level One: Lender has completed a verbal discussion with the buyer and has run a tri-level credit report and has discussed the terms of a potential loan.
- Level Two: The lender has received a completed and signed application.
- Level Three: The lender has received and reviewed a signed application with all supporting documentation and disclosures.These 3 levels are all considered Pre-Qualification. The more complete your LSR, the more likely you are to receive a positive response from a seller.
- Level Four: Lender has provided buyer with good faith estimate.Obviously when you submit an offer, you'll want all of your LSR to be as complete as possible.
What About a Cash Offer?
Cash offers are the best offers, but you'll need to provide the seller with proof that you are able to pay cash prior to submitting an offer, and you'll still need to complete the LSR as it is part of the Purchase Contract. There are no exceptions to this, so be prepared.