The Loan Process

Pre-qualification

Pre-qualification is the first step of the loan process. We gather information about your income and debts, and makes a financial determination about a payment you may qualify for.

It's a good idea to know how expensive a home you can afford before you start shopping for one. If you are refinancing the loan on your existing home, the pre-qualification process should help you decide whether refinancing is a good idea for you.

Application

The application is the beginning of the loan process.  We complete a mortgage application for a particular loan program and you supply all of the required documentation for processing. Various fees and down payment options are discussed at this time. We will deliver a Loan Estimate and a Truth-In-Lending Disclosure (TIL) within three days of loan submission that itemize the rate and estimated costs for obtaining the loan.

Processing of your Estimated Loan

We will usually submit your application into our automated underwriting system which will provide the necessary decision for loan approval. In some cases, we may submit your file for manual underwriting.

Your credit report and documentation are reviewed to verify your employment, debts, and payment histories. If there are late payments, collections, judgments, etc., we may requests a written explanation from you. The appraisal and title report are reviewed for any property issues that may affect final loan approval.

Underwriting

The lender's underwriter is responsible for determining whether the application package prepared meets all the lender's criteria. If more information is needed, the loan is put into "suspense" and you will be contacted to supply more documentation.

If the underwriter approves the loan, the lender issues a conditional approval to lend, orders title insurance, works with you to clear all conditions to its approval to lend, and then schedules a closing time. Conditions to the lender's approval may include issues with credit, income, or the property.

Closing

The closing will occur after all conditions are cleared and the lender issues a full loan approval. At the closing, the lender "funds" the loan with a wire to the closing agent, who disburses funds, in exchange for the title transfer to the property. This is the point at which you finish the loan process and actually refinance or buy the house, subject to the lender's loan. Closings occur at different places in different states. For instance, some states require that the closing take place at a closing attorney's office, while others use a title or escrow company. You may also be able to close at your home.