If you’re anything like us, the idea of buying a house is so exciting! But before you dive into decorating and sharing pics on social media, you gotta get a grip on what the mortgage process is all about and what to look out for. In this post, we’ll lay out the steps in a simple way so you know what’s coming and can get yourself ready.
Step 1: Pre-Qualification / Pre-Approved:
Getting a mortgage? First things first, you gotta get pre-qualified! This means filling out a loan application, the lender checking out your credit score, and possibly sending in a few documents. Pre-Qualification is a super quick way to see how much you can spend when looking for a home. It requires less paperwork and often works off estimates to figure out what might be a good fit for your home financing. Plus, you can usually get pre-qualified the same day you apply!
If you’re ready to start making offers on homes and want to stand out, a Pre-Approval could be your best bet! A Pre-Approval shows that the lender is pretty much ready to lend you money based on a thorough review of your loan file. The only thing missing is the property itself—the rest of the paperwork has been fully looked over by our underwriters. Pre-Approvals send a strong message to sellers that you mean business and have your lender’s backing!
Step 2: Processing
Once you have your Pre-Qualification, your loan file will be assigned to a processor. In this stage, you will need to provide some supporting documentation and the loan processor will review your file to verify income, assets, credit score, and more. Services to support the loan process, including appraisal and title insurance, will be ordered as well.
Step 3: Underwriting
Once your loan processor has collected everything they need and lined up any extra services, they'll send your loan file off to underwriting. Basically, this is just having another set of eyes look over the loan documents to make sure everything's been done right. This team is all about double-checking the file against the loan program rules and what the lender requires. After they take a look, they'll make a call on the file. If you get a conditional approval, it means the loan is good to go, but there are a few things to sort out before you can close. If you get a full approval and are clear to close, then you're all set to move on to the next step!
Step 4: Closing
Your mortgage loan closer is here to help wrap up all the details and paperwork so you can get ready to sign! At this point, you should get your final Closing Disclosure, which breaks down all the costs and fees for the deal. You'll receive this before closing day, so make sure to take a good look at it and hit up your New Point Loan Originator if anything's unclear! Once everything checks out, you're all set to sign! At New Point, we've got a super cool closing system that lets you sign 85% or more of your closing docs online – way quicker and no more hand cramps! A couple of papers might still need the classic ink pen and paper treatment, but once you get through those, it’s time for the BEST part of the whole process…
Step 5: Funding & Moving
During the funding stage, a lot of stuff is going on to make sure buying your home goes off without a hitch. The mortgage lender sends money over to the Settlement Agent and goes through all the signed papers to catch any mistakes. Once everything checks out, the mortgage funder gives the green light to the Settlement Agent to release the funds. That’s when the magic happens! You get the keys and you’re officially a homeowner! Congrats!
As you can see, there’s a lot of detail in a mortgage deal – but at New Point Lending, our experienced team makes it feel super easy and keeps everything running smoothly for you! If you have any questions during the loan process, don’t hesitate to reach out so you can feel confident and at ease.
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