Picking out a home is usually a fun and rewarding experience. But, the process of getting a mortgage for that new home can be less than thrilling. Hartz Homes wants to provide you with a brief overview of this process so that it will seem a lot less daunting and not ruin the experience of building your new home.
Here are the steps you can expect during the mortgage process.
Pre-Approval
While many lenders require this step, it is often optional before you actually begin to look for a house. However, it’s a good idea to take this step first – so that you know how much home you can afford before you begin the legwork of looking for a home.
During this phase, you can expect your lending institution to ask you for pay stubs, your credit report, a copy of your most recent tax return, last two months of your investment and bank statements, and your W-2s.
Note that there is a difference between pre-approval and pre-qualification.
Pre-qualification is a simple step that provides an estimate of what you might be able to borrow for a home. You provide a look inside your financial situation, but your credit score won’t be pulled.
Pre-approval is the more commonly used option. It’s when you and your mortgage lender review your credit report and determine your debt-to-income ratio. Your credit report is pulled and a complete analysis of your financial records is made.
Full Loan Application
This step kicks in once you have found the property you want and you are interested in moving forward with its purchase.
You will need to update any information contained in your pre-approval package that is more than 90 days old. In addition, be prepared to address any discrepancies that crop up on your credit report.
Your loan officer might also require documentation in connection to deposits into your bank accounts that are in excess of $1,000. It is at this stage that the full mortgage application will be completed by you and the loan officer.
Processing the Application
The next step involves a mortgage processor who looks over your loan application. In addition to ensuring that all the information on the application is complete and that the loan officer did not overlook anything, the processor will order an appraisal of the property you want to purchase, as well as a title search and its accompanying legal work, if necessary. This second step is an important one to ensure that everything is in place for the loan and that nothing is inadvertently missed.
Submitting The Application to Underwriting
When your financial institution receives the appraisal paperwork back and all is in order, it is time for it to be submitted to underwriting.
During this phase, the processor will file a report that is designed to unearth any fraudulent activity — if any such activity exists. Within this report – which often can encompass dozens of pages – both you and the seller will have their histories examined closely. The report will look at your background, as well as the background of the real estate and other property professionals that are involved.
The appraiser and any attorneys that are part of this real estate transaction will also have their backgrounds closely examined to rule out any fraudulent behavior. If anything of note comes back, the process will ask for more documentation to alleviate any concerns.
The Underwriter’s Role
Once your loan package is submitted to the underwriter, that person combs through it thoroughly to ensure that all of the required documentation is included. Each detail of the application is reviewed to make sure that all regulations and applicable laws are complied with.
While particulars might differ depending on the particular loan that you are seeking, all must meet the guidelines established by the state and federal authorities.
Understanding this process can eliminate any confusion and smooth the way for an enjoyable home buying experience. For more information, contact a Hartz Homes sales office or Guaranteed Rate, the preferred lender for Hartz Homes.
Please check out these new home communities from Hartz Homes:
Armitage Pointe of Addison, Illinois (Chicago area new home construction)
Bella Vista Townhomes of Bolingbrook, Illinois (Chicago area new home construction)
Heather Glen of New Lenox, Illinois (Chicago area new home construction)
Hibernia of New Lenox, Illinois (Chicago area new home construction)
Leigh Creek of New Lenox, Illinois (Chicago area new home construction)
Manchester Cove of Mokena, Illinois (Chicago area new home construction)
Marquis Pointe of Montgomery, Illinois (Chicago area new home construction)
Marywood Meadows of Montgomery, Illinois (Chicago area new home construction)
Nantucket Lakes of New Lenox, Illinois (Chicago area new home construction)
Oliviabrook of Oakbrook Terrace, Illinois (Chicago area new home construction)
Park West of Manteno, Illinois (Chicago area new home construction)
Playa Vista of Plainfield, Illinois (Chicago area new home construction)
Sky Harbor of New Lenox, Illinois (Chicago area new home construction)
Whisper Creek of Mokena, Illinois (Chicago area new home construction)
Hartz Homes has new home communities in:
Addison, Illinois (Chicago area new home construction)
Aurora, Illinois (Chicago area new home construction)
Bolingbrook, Illinois (Chicago area new home construction)
Lockport, Illinois (Chicago area new home construction)
New Lenox (Chicago area new home construction)
Manteno, Illinois (Chicago area new home construction)
Mokena, Illinois (Chicago area new home construction)
Montgomery, Illinois (Chicago area new home construction)
Plainfield, Illinois (Chicago area new home construction)
Oakbrook Terrace (Chicago area new home construction)