Mortgage

The Loan Process

Application

The first step is simple - you need to apply for your home loan. To process your application through any program, your loan officer will need financial information about you - your current mortgage or rent, your other loans, your income, your assets, etc. Your loan officer will be able to help you through this process.

Preliminary Approval

Within a couple of days (in most cases sooner), you will have a preliminary loan approval.  Your approval will be based on the basic information you give to your loan officer.  The information you provided will be verified during the loan processing phase.

Loan Processing

This is the verificaiton phase of the mortgage process.  Your loan officer will need to make sure you understand what's going on and its financial implications.  You will complete and sign a Loan Application and provide copies of bank statements, income, and paperwork relating to other assets and debts.

Appraisal

The appraisal is scheduled by the bank to determine the value of the property that you want to purchase.  The appraiser will schedule a visit to the home to view it's condition, take photos and measurements.  Next, he or she will research comparable properties that have recently sold to help determine the appraised value of the home.

Final Approval

If you have ever heard the term "Mortgage Underwriting" this is it.  Your loan officer will submit all necessary application forms, documents and other materials to the mortgage underwriter who will then verify all of the inforamtion and review the appraisal.  The underwriter will then make a determination about whether the information provided fits within the banks guidelines for the mortgage loan program you have applied for.  The underwriter will consider several things:

* The Property appraisal report.
* Total Debt-to-Income-Ratio.
* Cash Reserves: After your loan settlement costs are paid, this is the amount of money left over in your bank account.
* Credit History: Looking at your past debts and payment history is a measure of how likely and able you will be to repay your loan.
* Employment History: This isn't only how much you make, but how stable is your income.

Closing

This is the OFFICIAL meeting between you and the sellers where you sign all of the necessary loan and title paperwork and teh property is tranferred to you!  You will be responsible for bringing a photo ID and your cashiers check for the remaining downpayment and closing costs that you will owe.  When all the documents are signed, the title company transfers the money from your mortgage company to the sellers and the house is yours!