Whats the Home Loan Pre Approval Process ?

So whats the Home Loan Pre Approval Process or mortgage loan process ? Its a windy road with many twist and turns but with good preparation and know how it not any more difficult than a country road with some bumps and grinds.

First time home buyers and even seasoned investors should get prepared by getting all their ducks in a row. You can read more about in on this site and many articles on this site. You can also download a loan package and print it. Once your loan application is faxed or mailed your loan process begins.

Credit evaluation
Upon receipt of loan application online, or via fax along with credit authorizations, we will order a full 3 bureau “Mortgage credit report” with Fico scores. Mortgage Credit report are priced differently than the ordinary reports and are payable by visa or check.

Credit approval
With a basic loan application and a mortgage credit report in hand, a loan officer can get you  pre- approved or even get a full approval. This is usually 48 hour process process with minimal paperwork involved at this stage.

Rate lock agreement
All A paper borrowers have to lock in their rates upon loan approval. If you are locking a rate, a rate lock agreement is sent to you. You can sign and fax a copy back to processing for your loan rate lock.

The appraisal
Since 2008 usually an appraisal is ordered earlier than later to avoid valuation problems.  The appraisal usually takes 7 to 10 days and have to be paid by the borrower upfront because appraisers don't lend credit. The cost of appraisal depends on the property and ranges from $350 to $450 depending on the property. One to four units have different costs than a single family home because rents are involved.

Local title company or settlement agent
If you are purchasing a home,  your Realtor is contacted to set up escrow accounts. If you are refinancing a current loan, an escrow account is automatically opened on your behalf by the mortgage lender.

Loan processing
As the loan processing moves on, an individual member of our loan team will be in contact with you to update your loan status, and request any additional documents.

Loan closing

Upon underwriting approval and when all the loan conditions are met, a closing date will be set and loan documents will be sent to your local escrow/attorney or a notary will sign off your loan documents in your home. You do not have to take time off from work.

After the signing of the documents your loan should be funded within 72 hours if all the documents and conditions are met. A deed will be recorded in your name and you will own your own home !