10 Steps to Homeownership
1. Loan Application and Pre-Qualification
The first step in the process is to complete a full loan application.
Once your application is received, an experienced mortgage professional will guide and help you determine which financing options are best for you! This does not guarantee you a loan but gives you the comfort of knowing how much of a mortgage loan you may qualify for.
Paperwork supporting the loan application must be submitted and verified.
Information commonly sought includes pay stubs, two years’ tax returns, W2 and 1099 forms, copies of photo ID’s, and bank account statements verifying the source of the down payment, funds to close, and reserves.
3. Home Shopping
Begin shopping for you’re your new place to call home!
A licensed real-estate professional will help you determine your needs and desires, and present many options to you. Once you find the right place, the terms of the sale will be negotiated, including the price and potentially the terms of the loan being sought.
4. Begin the Loan Process
After going under contract your mortgage professional will put together the best loan deal for you.
The next step is to meet with your mortgage professional and their team to review the loan terms and sign the initial paperwork. Then your mortgage professional’s team begins processing all your documentation.
At this time they package your application and documentation together as best as possible to present your credit worthiness to a licensed mortgage underwriter.
5. Inspection and Appraisal
It is in your best interest to conduct an inspection of the property your are purchasing with you real-estate professional and a licensed
home inspector. The home inspection will check for any possible structural and material defects in the property and then you can decide if you want to ask the sellers to have any of these items fixed before you lose on the home.
Lenders do not require a home inspection, but they do require an appraisal on all home sales. The appraiser job is to assess the true market value” of the property to make sure the sales price and loan amount support the negotiated terms.
A mortgage underwriters job is to asses the risk of lending you, the applicant, money to purchase your home. They will consider factors such as credit history, employment history & income, and your ability to repay when determining if they will approve your file or not.
7. Conditional Approval
After the initial review, the underwriter will return their findings to your loan officer requesting any additional documentation to
support the information on the application. It is important to ensure there are no changes in your employment or credit file
throughout the entire loan process.
8. Final Approval
After reviewing all submitted documentation such as income documents, inspections and/or appraisal, asset documentation, employment
verifications, source of down payment, etc., the underwriter will issue the final loan commitment.
Closing will be conducted at the title company listed on the sales contract. They will disburse all funds to anyone involved in
the transaction and ensure that you receive clean title to your new home. They will also record the warranty deed putting the
property in your name and file the Deed of Trust that puts the lien on the property.
You are now a new homeowner!