Obtaining a mortgage should be a buyers first step when considering buying a home. You want to first confirm that you are eligible for a mortgage and secondly what is the maximum price of a home that are qualified to buy. We suggest you contact 2-3 mortgage companies to make sure you get a company you are confident about and they will be offering the best program for you along with competitive interest rates.
For many of us, the joy of hearing “your loan has been approved” represents the moment when we realize the dream of homeownership is about to be fulfilled.
When it comes to purchasing a home in today’s real estate climate, it is advisable to get the financing in place as early as possible.
With regulations and guidelines for lending at all time highs, you need to understand the mortgage lending process and need expert guidance as you move forward.
The time frame from the applying for a mortgage to the time a mortgage company can close on your mortgage is generally a range of 3 weeks to 2 months depending on the mortgage company and the type of mortgage you obtain. VA and FHA loans take the longest regardless of the mortgage company. Following are the steps in the mortgage process.
Step 1: Get pre-qualified to establish your price range. By getting pre-qualified via phone, online application or in person with a mortgage consultant, you will get a solid understanding of your mortgage options and price range.
Step 2: Visit properties and find your dream home. Working with your real estate broker to determine your optimum location, visit properties and discover your dream home.
Step 3: Write an Offer to Purchase – including a “Letter of Qualification” from your mortgage consultant. In today’s market, an Offer to Purchase including a Letter of Qualification is regarded as more solid and credible.
Step 4: Upon acceptance of your Offer, complete your Mortgage Application. Collect and send your mortgage application documents to your mortgage consultant who will prepare your application for your signature
Step 5: Sign your Mortgage Application and your mortgage consultant orders a property appraisal. The appraiser then determines if the accepted sales price meets all the necessary guidelines.
Step 6: Property inspections are completed and repair issues (if any) are negotiated with the seller.
Step 7: Select homeowner’s insurance and have your insurance agent contact mortgage consultant immediately.
Step 8: Your loan is reviewed and underwritten. Upon receipt of the necessary documentation, the file goes to our Underwriter for approval. A loan may be approved outright, or more commonly, approved with conditions. The loan processor will review these conditions and may require you to provide further information if needed.
Step 9: Inspection report(s), appraisal and application documents are brought together to create your “Closing Package.” Once any conditions have been satisfied, all your documentation is in hand and your appraisal has been received, our underwriters will approve your Package for closing. Also, during this time, your homeowners insurance company will need the appraisal to bind your insurance. If there were any home repairs needed, a final inspection may be required at this time.
Step 10: Your Closing Package is sent to the attorney selected to perform the closing and the HUD-1 statement (outlining funds needed for closing) is drawn up for approval by both you and the seller prior to closing. The amount of funds needed for closing are on the HUD-1 and a check in Certified Funds should be made payable to the closing attorney.
Step 11: Your home closing typically takes place at the closing attorney’s office, where closing documents are signed and your purchase is completed. Depending on the time of day, the closing may not be recorded by the courts until the following day. In this case, you may not receive the keys until it is recorded, so check with your agent if you have any questions.