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Financing Your Home

     Did you find a home? Now you must figure out how to purchase of your home, there are several steps you can expect in the loan process. The basic life cycle of the loan process is:

  1. Prequalification
  2. Loan Preapproval
  3. Loan Processing
  4. Loan Submission and Approval
  5. Loan Closing


PREQUALIFICATION is your first step toward the purchase of a home. You will provide some basic information so the mortgage company can briefly review your credit history, income and debts. This will provide you with a good indication of your target price range for a home and an understanding of the additional documentation you will need to provide.

LOAN PREAPPROVAL is similar to a complete mortgage loan approval except there is no property used in the consideration of the loan. You receive loan approval pending a contract on an acceptable property. You may want to get a pre-qualification letter. This is a letter you show your real estate agent so that he/she will know what price range of home to show you. The real estate agent also uses it during the offer process to better position your offer among others.

LOAN PROCESSING. Starting with the information obtained from you during loan application, a report including a credit report, verifications of employment and deposit, and a property appraisal. Loan processing is usually the most time consuming part of obtaining a home loan.

LOAN SUBMISSION AND APPROVAL. Next, your loan package is submitted to an underwriter, where the decision to approve or reject the loan will be made. The underwriter will review your financial information and make sure it meets the criteria for granting the loan. If everything is in order, the underwriter will issue loan approval. Occasionally, the underwriter will require additional information from you before or at closing.

LOAN CLOSING. You made it! Now that your loan has been approved, you and the seller will decide when you want to close or finalize the sale. The closing department will need at least twenty-four to forty-eight hours notice in order to prepare the closing documents. At closing, the seller will convey the property to you, and you will sign final documents agreeing to the terms of the mortgage repayments.

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