Overview

Obtaining an affordable mortgage depends not only on what you feel you can afford, but more importantly, on what a lending institution says you can afford. Before lenders will issue a commitment to lend large sums of money, they must be assured that you can afford to repay the loan and that the value of the property is sufficient collateral to guarantee repayment of the loan in case of default.

Step 1 Pre-Qualification

This is where your homebuyer journey begins. I will gather basic information on you to pull your credit, understand your employment history, and get your income information. Once I have reviewed your credit report and credit history I can guide you as to what mortgage loan options are available, what the next steps are in improving your credit score, and tell you how much you can be approved for. Ideally you will want to complete this step before you begin looking at houses and before you meet with your real estate agent. Doing this first will show your agent and the seller of your desired property that you are a serious, qualified home buyer.

Step 2 Application

I will meet with you and fill out the paperwork needed to apply for a home loan. We will discuss the type of mortgage that will best suit your needs and review the various documents I have asked you to bring along in support of your application. I will also explain the required disclosures that keep you informed of your rights and obligations. The more accurate and complete your application is at the meeting, the less there will be for us to do before closing on your home loan.

Step 3 Processing

A processor orders the property appraisal, full credit reports, and mails any necessary verification of employment and deposits. The good faith estimate is generated and sent to the buyers.

Step 4 Underwriting

The underwriter reviews documents and property appraisal for final approval. The more documentation the underwriter receives (re: w-2’s, pay-stubs, divorce, child support, bank statements, etc) the quicker the approval. Any missing documentation that is required by the underwriter becomes a “condition of the loan.” The commitment letter is sent to the buyer, buyer’s attorney and the seller’s attorney (if info is available.) Upon receiving your commitment letter, you should contact your attorney. Review your conditions and discuss the action that he/she will take in obtaining the legal documents. They will contact the sellers attorney to obtain the updated abstract, updated (or new) survey, current tax bills, payoff, and tax search.

Step 5 Conditions

The conditions are listed on the last page of the commitment letter. If you are unsure of what is being requested, please call immediately. All conditions must be met before your loan can be scheduled to close. If the property needs repairs, the repairs must be completed and reinspected prior to closing. The real estate agent will notify the lender when repairs are complete. At this time you should obtain your homeowners insurance.

Step 6 Closing

Once your conditions have been satisfied your loan is ready to close. Your attorney will send the property legal work to the bank’s attorney and then contact us to schedule your closing.

Step 7 Congratulations

You may now move into your new home. I hope that the process went smoothly and you are satisfied with our service.

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