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Having
a basic understanding of the home loan process and knowing
what to expect cannot only help you make informed decisions
about the right loan for you, but can really alleviate
much of the stress of finding a home and obtaining a
loan to purchase it. We can help throughout the process.
If you have any questions about South Bay homes and
real estate, home loans, mortgage brokers, or investment
opportunity, contact
us today!
Things
to know and understand during the loan process
Documentation
- Understand that in order to finance a loan the lender
requires documentation to verify and substantiate your
employment, credit and financial situation to assure
its investors that you have the ability to repay the
money. This documentation may consist of tax returns,
recent pay stubs, bank statements, verifications of
employment, deposit and rent or mortgage, appraisal,
purchase agreement, divorce decrees, bankruptcy papers
and any other information the lender deems necessary.
Communication - Understand that you will have
to provide a completed loan application and the requested
documentation to your loan agent. The loan agent will
be the intermediary between you, the borrower, and the
underwriter. The underwriter is the person who goes
through the documentation and information you have provided
with a fine-tooth comb to make sure everything fits
the program requirements. You will not be able to speak
with underwriter - it is the loan agent's job to communicate
information to and from the borrower.
Patience
- Expect to wait. It may take several days to a week
to get the initial response from the underwriter. The
underwriter will either approve the loan as it is or,
more likely, provide a list of items that need clarification
or additional documentation.
Ongoing
Process - Expect to be asked to provide additional
items. Once you give these to your agent, it will be
a few days before you hear back again. The underwriter
may come back to the agent several times with certain
"conditions." Don't be concerned. The underwriter
is simply doing an underwriter's job. At this point,
what you have is conditional approval - meaning, your
loan is approved pending removal of these conditions.
Timeframe
- Understand that the entire loan process typically
takes between two and four weeks, possibly longer, depending
on the particular circumstances of the loan. Loans for
self-employed people, people with poor credit, or people
with unusual circumstances often take longer because
of the additional documentation required.
Signing
the Documents - Realize that once the loan is approved,
the loan papers will be sent to the escrow/title company
or your attorney. The escrow officer or attorney will
add other documents to the file created from information
received from the lender. Once these documents are prepared,
the escrow officer or attorney will contact you to set
up an appointment for you to come in and sign your papers.
Paperwork
- Expect to wade through and sign a mountain of papers.
The escrow officer or attorney should provide you with
a copy of everything you sign.
Closing
Escrow - Understand that from the date you sign
your papers, it will be another two or three days until
the loan is funded, which is when the money is transferred.
Moving
In - Know that the loan will close, or record (with
the county), one or two days after the loan has been
funded. Once the loan is recorded, the transaction is
complete.
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