Step by Step Home Loans
Buying a home is an important financial decision. Your lending professional is a key member of the team of experts assisting you in your purchase. By working with a professional lender, you'll save time and money, and gain critical negotiating power.
What Lending Professionals Will Do For You
A lending professional will work with you to analyze your current finances and mortgage options to come up with the best home financing options for you. By working with a lender before looking at homes, you will have a better idea of what you can afford.
This knowledge will make your real estate professional more efficient, strengthen any offer you make, and improve your overall home buying experience.
Many home loan options are available today. You can choose to work with a lender who works with one bank only, or you can choose to work with a loan broker. A loan broker works with many different financial institutions and can shop for the best loan at the best price, allowing you to work with one professional contact instead of doing all the shopping yourself.
Regardless of whether you rely on a lender from a particular bank or a loan broker, a professional lender will help you:
- Find the best loan options
- Fill out the application
- Obtain pre-approval
- Work with you throughout the escrow period to ensure timely approval and funding of your loan for a smooth home purchase
Getting Your Loan Pre-Approved
One of the most important steps a lending professional can do for you is to provide pre-approval. A pre-approval means that the mortgage company agrees and gives a vote of confidence that they will be able to fund your loan. This will give you added confidence and negotiating power as you make the offer to purchase your home.
The Loan Process
The Application
The lender will have you fill out a loan application, then he or she will obtain all pertinent documentation to avoid unnecessary problems and delays.
Requesting Documentation
Within 24 hours of submitting your application, the lender requests documentation to verify the information that you have provided. You may choose to bring some of these items with you.
Loan Submission
With all of your documentation in place, the lender submits the application and documentation as a package to the underwriter for approval.
Loan Approval
Loan approval generally takes anywhere from 24 to 72 hours. All parties involved are notified once the approval has occurred. Any conditions that you may have, such as proof of income or proof of down payment funds, must be met before the loan can close.
Loan Documents
Within 1 to 3 days after the loan approval, the loan documents (including the note and deed of trust) are completed and sent to your escrow company. The escrow company will then make an appointment for you to sign all final loan and escrow documents.
Funding
Once all the parties have signed the loan documents, they are returned to the lender, who reviews the package. If the loan documents pass final review, the loan funds are deposited by wire transfer with your escrow company.
Recording the Deed of Trust
When the escrow company receives funds from the lender, they record the deed of trust at the County Recorder's office. Escrow is now officially closed.