In order to buy homes, most individuals need to be approved for loans by mortgage companies. While a preapproval can be obtained in a matter of days or even hours, to be fully approved for a loan can take a month or more. If you're ready to purchase a house, be aware that there are multiple steps to take to obtain funding for your home. |
First step, of course, is to be preapproved by the lender of your choice. Do some research to find out who offers the best interest rates, terms, and the lowest closing costs. In order to be preapproved for a loan, you will need to submit your most recent payroll stubs, your personal data including your date of birth and social security number. The lender will pull a credit report to see what your score is. If you make enough money at your job, have cash in the bank for a down payment, and have a good credit score, you will receive the green light to proceed with the home buying process.
Even if you're an excellent candidate for a loan, mortgage companies also want to make sure the house you're buying is worth what you're paying for it. To do this, a certified appraiser will be hired to inspect the property and write a report verifying its value. Appraisers will go to the property armed with laptop, measuring tape, and a camera. He or she will make sure the house is in good shape, contains the square footage listed in the tax records, and compare it to other properties in the neighborhood. These comps investigate recent sales in the area. Because home prices fluctuate, the comparison sales must be within the last few months. If the property appraises for a lower amount than the selling price, the bank won't okay the loan. This leads to renegotiation between buyers and sellers.
After the house has been appraised for an adequate amount, mortgage companies verify all of the applicants' data such as length of employment, money in bank, and credit history. Lenders want to make sure that applicants will be able to successfully pay back the loan over a period of thirty to fifteen years. The verification step can be a lengthy process. Anything discovered that triggers questions would need to be explained by the applicant in a signed letter of explanation. It's important that buyers don't take out any new loans during this process or lenders may reject the application.
Finally, after the preapproval, the appraisal, and the sleuthing over all personal and financial data, mortgage companies approve or reject loans. If you have good credit scores, a stable job, and adequate income, your loan will likely be approved. Your next steps would be to pack up your belongings, find a moving truck, and move in to your new home.
When you are considering and comparing mortgage companies in Grand Rapids, MI, be sure that you are looking at the whole process. Learn about Founders Bank & Trust by visiting http://foundersbt.com.
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