Buy a Home
Pre-qualification is the first step after initial contact is made and occurs before the loan process officially begins. The lender gathers information about the income and debts of the buyer and makes a financial determination about how much house a buyer can qualify for and what loan programs are available.
The application is actually the beginning of the loan process. The buyer, now referred to as a “borrower”, completes a mortgage application with the loan officer and supplies all of the required documentation for processing. Various fees and down payments are discussed at this time and the borrower will receive a Loan Estimate (LE) within three days that itemizes the rates and associated costs for obtaining the loan.
Processing occurs after the Initial Loan Disclosures are signed. The “processor” reviews the documentation and sends the complete initial submission to the Underwriting team. At this time, any other necessary items are ordered such as the Appraisal, Title Work, Insurance verification, Income verification etc.
The underwriter is responsible for determining whether the combined package passed over by the processor is deemed as an acceptable loan. If approved, a "Conditional Approval" is sent out to confirm the loan is approved contingent on certain items needed. The borrower is contacted at this time to supply any additional documents. The team also works on retrieving any processor items previously requested. When we received the loan conditions, the file is re-submitted to the underwriter to approve and clear them. The underwriter may need additional items so it is important to with your loan officer on getting any items turned in quickly.
Pre-Closing time is spent clearing any final approval items and doing final verification such as a Verbal Verification of Employment. Once enough items have been approved, an Initial Closing Disclosure (CD) is sent out to the buyer to sign at least 3 business days before closing. When all approval contingency items are satisfied, a "Clear to Close" will be issued. A "Clear to Close" is the all-clear from the underwriter that allows us to move into the Closing stage. Once the "Clear to Close" is issued and the initial Closing Disclosure (CD) has been signed, the Final closing package can be prepped and a closing time can be scheduled.
Closing usually occurs between days 25 and 45 of the loan (depending upon the designated length of your escrow). At the closing, the lender “funds” the loan with a wire of the designated amount sent to the title company. This is the point at which the borrower completes the loan process and officially buys the home.