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Mortgage Glossary

Loan Process

THE LOAN PROCESS

Before you go looking for a new home, it is beneficial to know how expensive of a home you can afford. The pre-qualification process is as quick as submitting an application for review. Getting a full pre-approval is a more involved process, but has greater advantages. A pre-approval consists of submitting a full application and all supporting documentation for underwriter review. This process may take longer, but a pre-approval with help you.

• Carry more weight: when presenting an offer. A potential buyer is in a stronger position to negotiate if their loan is already approved.
• Close quickly. Your loan is approved and ready to close.
• Eliminate stress. You can concentrate on finding the perfect home without worrying about the status of your loan.

When buying or refinancing your home, it is essential to provide as much documentation as possible for the approval process to go smoothly. Below is a checklist of things you will need to submit:

• For a salaried employee provide a recent paycheck stub covering 30 days of employment and two years of W-2's
• For a self employed or commissioned employee, provide all schedules of the previous two years tax returns and a copy of your business license if applicable.
• Provide all pages of the last three months statements for all asset or retirement accounts in your name.
• Complete copy of a divorce decree if applicable.

Other documentation may be required depending on your personal profile or loan program.

Once you have fully executed a loan application form and compiled all required information, you need to consult a loan officer either over the phone or in person to review your documents and discuss loan programs. It is important to make sure you are informed about the programs you qualify for so you can make an educated decision about what works best for you. It is also important to get a Good Faith Estimate to compare the programs you are interested in and how the interest rates and fees may change. After these decisions have been made, the loan is submitted to our underwriting department for approval.

After the underwriter has reviewed the loan, additional items may be required prior to final approval. To insure the final approval is obtained in a timely manner, it is important to:

• Be available: make sure we have phone numbers where we can reach you promptly.
• Respond to all requests for additional items in a timely manner.
• Be sure to obtain specifically what was requested.
• Avoid moving money from one account to another, such transactions will have to be documented.
• Avoid making major purchases such as new cars, furniture and additional real estate. Your credit profile can be updated at any time and such purchases can adversely affect your loan approval.

Once your loan has been approved your Real Estate Agent will contact the Title Company involved in the transaction to schedule the closing for the closing date on your contract. if this is a refinance transaction, your loan officer will consult you for the required closing date and time. At the time of closing be prepared to:

• Show personal identification
• Bring a cashier check for all required funds, personal checks cannot be accepted.
• Review final loan documents. Make sure the loan terms and interest rate are accurate.
• Sign all loan documents.

In the event of a refinance transaction, the disbursement of the closing is delayed by the State law three business days. A real estate transaction usually funds and closes the same business day.