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5 Step Process for Mortgage Lending by Cleo Gib
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5 Step Process for Mortgage Lending |
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Finance & Investment
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Purchasing your first home is exciting. You'll get to experience homeownership and all that it entails. Before you walk into your dream home, you need to complete the process of finding a loan and mortgage lending in Catlin, Illinois. Many first-time homebuyers worry about what it takes to get a loan and get the keys to their first homes. Knowing what to expect can prepare homebuyers for the process. There are 5 steps to securing a mortgage. Prequalification Before you start shopping for homes, you need to get prequalified for a loan. It's important to shop around for a loan and find a financial institution that will meet your needs for a mortgage. The process to get prequalified includes reviewing your work history and your credit history. You'll need to provide information about how much you make and any debt that you have. If you have a lot of debt, it would be helpful to pay it off as much as possible before talking to your bank or credit union. You could run your credit to look for any issues that should be resolved before your credit report is pulled by those prequalifying you. Once you've completed the paperwork for prequalification, your lender will tell you how much money you may borrow to buy a home. Application Once you've found the home of your dreams, it's time to apply for the loan. You'll meet with your mortgage lender to review your application. This time, you'll include your last 2 W-2s, pay stubs from the previous 2 months, and the latest 2 bank statements. Your lender is looking to see what you can afford to pay for your home. Home Appraisal During the process, your lender will have an appraiser visit your dream home. This individual will walk through the home and determine its value. The lender has the home appraised to ensure the home is worth what you’ll be paying for it. After completing the walkthrough, the appraiser will do some research into similar homes in the neighborhood that were purchase recently. The appraiser will compare it with other homes to determine the true value of the home. Underwriting Then, your loan will be sent to an underwriter. The underwriter will review your loan to make sure that you'll be able to pay it off. Then, you'll find out whether the underwriter approved your mortgage loan. Some underwriters will even counteroffer your loan application. For example, you may want a 15-year mortgage. If the underwriter reviews your application and determines that it would be difficult for you to pay off the loan in 15 years based on other responsibilities and debts that you have, the underwriter could counteroffer with a 30-year loan instead. Closing Once you've been approved and complete the rest of the process to purchase the home, you'll need to sign a stack of documents. Signing all of the paperwork finalizes or closes the purchase and secures your loan. Your real estate agent or attorney can go through the paperwork with you, so you can ask any questions that you may about the documents. After you’ve signed all the paperwork, the lender will typically wire cash to the home sellers. Typically, you won’t move into your new home until you’ve signed all of the papers to close on the home. Then, you'll receive the keys to your home and prepare to move in. Depending on the financial institution that you choose for mortgage lending in Catlin, Illinois, the steps or criteria may vary. If you have any questions about the process, make sure to contact your mortgage lender as soon as possible. It's important to meet with your lender early in the process, so you can get the best mortgage loan for your situation and will be able to close as quickly as possible.
Related Articles -
Mortgage, Lending, Catlin, Illinois,
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