application process, with its countless loan documents,
unfamiliar terminology and uncertainty, can be complicated
and stressful. However, if you understand the steps required
to apply for a mortgage loan, much of the stress can be
The first thing you should do (after choosing your REALTOR– even before you start
shopping for a house – is choose a lender and get
pre-qualified for a mortgage loan. Pre-qualification
provides you with a ballpark estimate of how large a
mortgage you can afford. This will help you to focus your
shopping on homes that fit into your price range.
To get pre-qualified, set up a meeting with the lender. The
lender will ask you many questions regarding your income,
debts and assets, as well as explain your financing options
and the loan amount you can qualify for. Many buyers choose
to get pre-approved, as well, at this time. A loan
pre-approval gives you a stronger bargaining chip when you
are negotiating with the seller because you have basically
already been approved for a mortgage loan.
Once you have an accepted offer to purchase on a home, your
next step is to set up a loan application meeting with your
lender. During your loan application meeting, the loan
officer will fill out, or help you fill out, the loan
application form. The application asks for information on
the property you are buying, terms of the purchase contract
and your employment and financial history.
You can complete the loan application process much more
easily and accurately if you prepare for it ahead of time.
When you call your lender to arrange the loan application
meeting, make sure to ask the lender what information and
supporting materials you will need to have with you to
complete the application.
After you have submitted your loan application, your loan
officer gives your file to the loan processing department
where the information is verified and calculations are
checked. The loan then passes to the underwriting stage,
where the decision to approve or not approve is made.
Once your loan is approved, it moves to the final step in
the process – the closing of the transaction. Documents must
be signed, fees paid and title transferred. Once the sale is
closed, the house – and mortgage – are yours.