Mortgage Loan Process

    Steps to the Mortgage Loan Process

     

    Prequalification

    Prequalification occurs before the loan process formally begins. The lender gathers financial information from the borrowers and makes a conditional determination about their qualifications for a loan

    Application

    The application is the beginning of the formal loan process. The applicant completes a mortgage application with the Mortgage Professional and supplies all of the required information and documentation for processing. Various down payments and “closing costs” are discussed at this time and the borrower will receive a Loan  Estimate (LE) and a Truth-In-Lending statement (TIL) that itemize the rates, loan fees, and associated costs for obtaining the loan

    Processing

    The lender reviews the documentation and provides a loan package for the loan underwriter.

    Underwriting

    An underwriter determines whether the information provided is acceptable to offer the applicant a loan. If more information is needed, the applicant is contacted to supply it.

    Mortgage Insurance

    For a conventional loan, mortgage insurance is required when the down payment is less than 20% of the loan amount.  FHA and VA loans also require mortgage insurance or similar protections.

    Pre-Closing

    During this period, title insurance is ordered, all approval contingencies are satisfied, and a closing date is scheduled for the loan. home loan, mortgage, approval, qualification, buying, purchasing, lender, loan, real estate

    Closing

    At the closing, the lender “funds” the loan with a cashier’s check, draft or wire to the selling party in exchange for the title to the property. This is the point at which the borrower has completed the loan process and the transaction is “closed.”