Purchasing a home can be one of the biggest financial transactions you make in your lifetime. While it is an exciting time for you and your family, the actual process of acquiring the home loan can be quite challenging if you are unfamiliar with current requirements or if you do not have the right professional partner to guide you. While there are many steps in attaining a loan and finalizing a home purchase, the information below can give you a basic idea of what is expected. Your mortgage professional will fill in the gaps and guide you through the additional requirements throughout the process.
1. Get Pre Approved. The first and most important step in purchasing a home is to get pre approved for the loan. Your mortgage professional can take the complete application over the phone and with the few documents necessary, can offer a pre approval letter for the loan amount that you may qualify for. Talk to us about what you are looking for in a home and we will go over the financing options which may be available to you.
2. Choose an Agent. Choosing the proper agent to represent you in your home purchase is essential to having proper negotiations and a smooth transaction. We recommend that you interview several agents before making your choice. Agents are your fiduciary representation and owe you a duty of utmost honesty, good faith, and must act in your best interest. In your review, you may consider personality traits, experience, location and knowledge of your desired purchase area, and a number of other factors. An agent is someone who you may be working with very closely for some time so it is important to choose someone who you are compatible with, but also someone who you believe can represent you best.
3. Begin Your Search. Work with your agent to find your dream home. While you may be tempted to consider a wide variety of available homes for your new purchase, it is important to set certain criteria for features you require and which you and your family ‘must have’. These required elements may consist of a certain number of bedrooms, minimum square footage, a location within a certain part of town, etc. Setting this criteria will help to minimize time spent on viewing homes which may ultimately not meet your needs. Your agent can assist in setting this criteria and can have emails of available listing automatically sent to you from a multiple listing service which meet your specific needs.
4. Processing of the Loan. Once you have chosen your new home and have signed the purchase agreement with the seller, we are now set to submit your loan to the lender. Prior to this step, we have gathered the needed documents from the buyer and have monitored interest rates between varying lenders so that we are prepared in advance and can choose the best lender for our scenario. Disclosures for the loan will now be reviewed and signed with a detailed analysis of any fees, your interest rate, and APR. The lender will take a few days to provide a conditional loan response which may include a request for additional documents from the borrower and which will also provide a status on the loan file. During this time, a home inspection should be considered and an appraisal of the home will be administered to ensure proper value of the home. The full loan process can vary in duration but will most likely coincide with your escrow time period. Standard escrow periods are usually either 30 or 45 days and loan docs will be signed just days prior to the closing of escrow. Upon closing and funding of the loan your keys will be delivered to you and you will now be able to move into your new home!
