In this second installment of this series, we will talk about the ins and outs of the actual home loan process.
Buying a house can be a daunting task, but when you break a larger task into smaller parts, it becomes more manageable. We are here to empower you with the knowledge you need to go into the process confidently.
The steps you need to know will be broken down into pre-approval, an appraisal, underwriting, and closing. The sections below will guide you easily through the process.
First: Get pre-approved
The pre-approval process can start with the 5 minute loan approval. You will need to inform the lender of your credit score, employment history, budget, and how much you have for a down payment.
The lender reviews this and other important information, after which they may offer a pre-approval letter. If after reviewing the information, and the lender does not see any reason why you couldn’t buy a home for what you’re looking for, you can move forward to the next step.
Second: Get an appraisal
Often, a lender must obtain an appraisal to determine if the home’s value supports the requested loan amount.
Third: Get the loan approved
Once the appraisal is complete and the home is worth the investment, the file is sent to underwriting. In some cases, there are lenders who have underwriters who work for them. Underwriters go through everything with a fine-tooth comb to ensure the file meets all loan product and regulatory requirements to approve the loan.
Last: Closing
Once the contract has been submitted for “clear to close,” the lender can close the loan. This will result in closing costs, but first-time homebuyers can seek out programs where they may not have to come out-of-pocket for them. And that’s it!
Hopefully, the breakdown of this process will get you one step closer to owning your dream home. In the last post of this series, we will talk about the benefits of owning a home versus renting one. Stay tuned!
The Home Loan Expert
