blog post May 30, 2018
Advancing from point A to Z in the home-buying process can be a slog, especially applying for a mortgage loan. To make it easier for your dream of owning a home to become a reality, I’ve provided—in consultation with Joanna White of Key Mortgage—a list of easy-to-follow steps on how to obtain a mortgage:
- Qualify for a Loan
This is where you work with your mortgage broker to see if you qualify for a home mortgage, and learn how much you can afford to spend, explains Joanna White of Key Mortgage. Remember that late credit card payments, or even too much debt, can have a negative impact on your credit report. This may affect the mortgage rate you are offered. So to ensure the best possible mortgage rate, try to maintain good credit in advance by paying all of your bills on time and reducing any debt you may have. It’s also wise to obtain a copy of your credit report to be sure there are no errors that may negatively affect your chances of being approved for a mortgage. You can get a free copy of your credit report here.
- Shop for Your Dream Home
With your budget in mind, begin working with your real estate agent to find the perfect home within your budget. During this time, be sure not make any big purchases. Large purchases, especially ones made on credit, may change the terms or amount of your mortgage loan.
- Negotiate and Get Your Offer Accepted by the Seller
Be patient during this part of the process. Sometimes it takes a little negotiating to agree on the price that is accepted to both you and the seller, White notes. Most often, a seller is open to negotiation. If they aren’t willing to negotiate on the price, you may want to try to negotiate on the items such as the closing date, or perhaps on appliances the seller may be willing to leave in the home.
- Apply for a Mortgage Loan
Key steps of this process include updating your financial information and locking in an interest rate. Once those things are done, your mortgage broker will send the documents to you electronically for you to sign.
- Documentation Review
This includes the house appraisal and your loan application. It may sound complicated, but don’t worry! Your loan officer will do the heavy lifting and is there to help you every step of the way.
- Receive Your “Yes” to Your Loan Application
After your loan underwriter and mortgage broker work together to review your documentation, your underwriter will request any additional information anyone involved in your loan process may need. Be sure to comply with each request as quickly as possible.
- Loan Approval
Once you have supplied your underwriter with all of the documentation they need, your loan will be closed. Your real estate agent and your attorney will be notified so that everyone can work together to plan the most convenient day, time and location for your closing. You will be notified of how much money you need to bring to the closing, and in what form the funds must be delivered. Most likely, a cashier’s check or money order will be required.
- Congratulations! You’re a Homeowner
All of your hard work has paid off. Finding the right mortgage team is critical in navigating you through the loan application process. You are now the proud owner of your new home!