STARTING THE LOAN PROCESS

By now, you’ve obtained your lender, you’ve gotten pre-approved, and you’ve found your dream home. It is time to start the loan process! Your licensed loan officer will help you gather paperwork and submit your mortgage application.

SUBMIT YOUR APPLICATION

Fill out and sign Form 1003 — the residential loan application — including the attached fair lending notice, loan info sheet, and credit authorization. Note: Do not use whiteout on this paperwork. Mistakes should be crossed out and initialed.

REVIEW YOUR LOAN ESTIMATE

This document contains important details about the loan you are applying for including estimations of your interest rate, monthly payment, closing costs, taxes, insurance and any prepayment penalties. The lender must provide this to you within three business days of receiving your application.

CLEAR ANY ADDITIONAL REQUESTS FROM UNDERWRITING

The underwriting department reviews all of your identification, paperwork, and credit history to asses if you’ll qualify for the desired loan. They determine the terms of the loan and will occasionally require extra documents to fully understand your background and make their decision. It’s important to make yourself available during the underwriting process and to respond to any requests promptly and thoroughly.

GET A HOME APPRAISAL

Inspections are important to help you fully understand the condition of a home. They can also be helpful for negotiations to help drive prices down or have additional services stipulated in the contract.

TAKE THE TIME TO GET COMMITMENTS IN WRITING

During the sales process, a seller may make a variety of verbal guarantees. For example, the seller may promise to fix the roof before move-in or provide all of the kitchen appliances. Make sure this information is included in writing in any agreements you sign. If an agreement is not explicitly written in a contract, the seller is not obligated to abide by it. This also includes all of the details of your loan. Make sure the amount, payments, rate lock, and other details are clearly stated in writing in a signed document.

REVIEW YOUR CLOSING DISCLOSURE

The lender must provide this to you at least three business days before you close your loan. This document contains the final terms of your loan. Use this timeframe to review it thoroughly and compare it to your Loan Estimate. Don’t be afraid to ask your lender questions if you are unclear about the terms!

MAKE YOUR OFFER

You may want to keep several factors in mind as you and your real estate agent get ready to present an offer to the seller:

  • The asking price of the home
  • Recent home sales in the area
  • Market conditions
  • Prospective resale value
  • Satisfaction with the neighborhood and amenities
  • Condition of the home
  • How many other prospective buyers are looking at this home
  • If you have a back-up home in mind

AFTER THE OFFER IS ACCEPTED

Before closing, clarify when the seller will be vacating the home. If they remain on the property after the closing date, you are entitled to negotiate rent payments. Set closing date, time, and location. Bring along any co-applicants and your realtor, if you would feel more comfortable having them present. Closing usually takes place in the presence of a public notary.

You should be prepared for several things:

  • Review final documents. Ensure the rates and amounts are what you have agreed to.
  • Bring a cashier’s check to cover the closing costs and down payment. Personal checks are usually not accepted.
  • Sign the loan and be prepared to show a photo ID and possibly a Social Security card.

RECEIVE YOUR NEW SET OF KEYS

Congratulations, you’re now a homeowner! Although you may now have the key to your future, don’t forget about the key to your mortgage. Contact us if you need guidance on any future questions or situations that may arise. A licensed loan officer will always be available to help you refinance, use your home equity, or even purchase additional properties to build your investment portfolio.

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