What are the five important parts of the Home Loan Process?
Interested in a mortgage loan but not sure where to start? You are not alone! The
process of buying a home can seem daunting and overwhelming. But don’t let that stop
you from achieving your dream of owning a home! This is a big financial commitment,
and it will seem much less intimidating if you break it down into five simple parts.
Here are five important parts of the home loan process:
1. Get pre-approved
The first step in the loan process is to see what you can qualify to buy. Reach out to your financial institution and request a pre-approval. Once you know how much you can afford to buy, you can narrow your home search. This also prepares you to put an offer on a home. A pre-approval shows the seller that you are a serious home buyer.
2. Offer Accepted
Once you find the home of your dreams and your offer is accepted by the seller, it’s time to get more detailed numbers. Your broker will help you find the best institution for your unique credit and financial needs. After you get your loan estimate, make sure not to make any other major purchases that could affect your credit score. You are also entitled to see your credit report from the lender if you so wish.
3. Loan Processing
After you start the loan, the lender will begin processing the loan. These are steps the lender will go through in order to confirm the safety of the loan. This entails verifying all of the details you provided during your application. The lender will request to see your most recent pay stubs to verify income as well as verify bank information.
An underwriter will be assigned to your loan to approve the final details. This person will cross all the t’s and dot all of the i’s prior to the final closing. They will assess all aspects of the application and the loan. They will ensure the home appraises for at least the loan amount to secure the loan. Once the underwriter completes this step, provide the final approval of the loan
Now is the day you’ve been waiting for closing day! This is the day you will get the keys to your new home, and the transfer of home ownership will be moved to your name. This meeting is typically held at the title company. You’ll need to bring a pen full of ink because there will be many pages to sign. Once you verify everything is accurate, you can sign and officially close on your home!