How the Home Loan Process Works in Five Steps
Loan Pre-Approval
Pre-approval is part of the official loan application process where a lender provides a conditional commitment for a specific loan term and amount. The benefits of pre-approval are two-fold: 1. You are armed with the knowledge of exactly what loan amount you can expect to be approved for, in order to shop for a home at or below that amount. 2. When you present a pre-approval letter with your offer on a home, you are at an advantage over any competitive offers which aren’t backed by the power of a pre-approval.
Select Your Loan Program
Fixed rate? Adjustable? FHA? There is a perfect loan for your unique needs, and we can help you find it. Are you looking for the consistent rates and payments that a fixed rate loan can provide? Do you want the short-term benefits of lower rates that an adjustable rate loan can bring? Our extensive portfolio of loan options means you have more options available to get just what you need. Your mortgage advisor will help you uncover just the right loan program, presenting options that meet your individual needs
Processing & Underwriting
Every loan has its own specific set of investor guidelines which need to be met. Your mortgage loan advisor will now work with two more experts to guide you further along your journey: a processor and an underwriter. Loan Processor Loan processors don’t just submit your file, they verify and validate all Borrower information and double check all of the documents provided to make sure there are no errors or mistakes. The processor makes sure your final application is in tiptop shape. Loan Underwriter Your loan has specific investor guidelines which have to be met, and it’s the job of your loan underwriter to be sure your financial profile meets these predefined guidelines.
Loan Approval
Between loan processing and loan approval, there is a flurry of activity happening behind the scenes, as multiple parties work together to get your loan to the finish line. Before your loan is fully approved, you will receive a contingent approval and a list of closing conditions that need to be met. These conditions can include verification that your employer is current, no new debt has been incurred, and proof that homeowners insurance has been obtained.
Loan Closing
With an approved loan and a clearance, you are on the home stretch of your journey. The lender will send closing documents to a title/ escrow agent that draws up paperwork and arranges for signing of documents and transfer of title. You will receive a Closing Disclosure with final terms and conditions of the loan which must be acknowledged at least 3 days prior to closing. Timely acknowledgment is key to closing on time.
Monthly Payment Calculator
Your monthly mortgage payment is calculated by adding the costs of the loan’s principal and interest, as well as any money held in escrow for taxes and insurance. How much will it be? Get an idea now and compare different loan terms.