How It Works?
The Loan Process
How it Works – The Perfect Loan
The Documentation Stage
During The Documentation Stage you are the most important player on the team. As quarterback of the documentation stage, there are a few critical documents we will be asking you to hand off. These documents include:
- W2’s – From the last 2 years
- 1040 Federal Tax Returns – From the last 2 years
- 2 Most Recent Paystubs
- 2 Most Recent Bank Statements – All pages
- Copy of your drivers license
During this stage, it is critical that you don’t change any aspects of your financial picture. This means:
- No Major Purchases (e.g. Purchasing urniture for you new home)
- No Applying for New Credit (e.g. Obtaining financing for Car)
- No Change in Employment (Please Don’t Quit Your Job!)
During The Appraisal Stage a licensed 3rd party Appraiser will estimate the value of the home you are about to purchase or refinance. This is meant to ensure for you, and your lender, that the home you are buying is worth the price that is being offered.
The most common method used by an Appraiser to determine your homes value is to compare it against recently sold homes in your neighborhood; typically over the last 6 months. Although the Appraiser will not account for the following when determining your home’s value:
- Roof
- Plumbing
- Windows
- Air Conditioning
- Foundation
- Floors
This is why we always recommend our clients obtain a Home Inspection when purchasing in addition to their Appraisal. If you’d like the recommendation of a good Home Inspector, please let us know, we are happy to help!
The Appraisal Stage
The Underwriting Stage
During The Underwriting Stage, our Loan Processor reviews all the submitted documentation that you’ve provided and then turns it over to our Underwriting Department. The Underwriter is responsible for performing three critcal tasks:
- Organization – The Underwriter will compile and organize your documentation for review.
- Analyze – The Underwriter will reconstruct your scenario to ensure it meets our qualification requirements and guidelines.
- Verification – The Underwriter will verify that all information is accurate and authentic.
It is not uncommon for Underwriters to request additional documentation, so please do not be alarmed or discouraged if this happens. Instead, be sure to accommodate these additional requests as quickly as possible.
This is an exciting step in the process! During The Conditional Approval Stage you receive the first indication that your mortgage loan will be approved by us, as it’s been initially reviewed by the Underwriter. Although, this approval is only valid if certain conditions requested from the underwriter are met. These conditions may include:
- Additional or Updated Documentation
- Letters of Explanation
- Acceptable Appraisal Report
Once you have met all the required conditions requested, your file will be re-submitted to your underwriter for final loan approval.
The Conditional Stage
The Clear-To-Close Stage
You’re almost there! During The Clear-To-Close Stage the Underwriter “double checks” that all documentation has been provided and all conditions have been met. At this time we will prepare the final loan paperwork that will need to be signed with a Notary Public. This is typically done at the escrow office, and schedule your closing.
Hooray! During the Closing Stage you will be signing the final loan paperwork and bring in any closing funds if needed. We then fund your loan and let you get back to living your best life. That wasn’t too hard, right!?
The Closing Stage
