Being a first-time home buyer can be exciting and intimidating! At Guaranteed Rate, we want to make the process as easy to understand as possible in an attempt to remove your fear, so you can enjoy your new home! But what exactly happens during the mortgage process?
Here are the four steps you’ll go through towards becoming a first-time home owner once you’ve completed your mortgage application:
1. Kick Off Processing
This is where it all begins. First, you’ll receive pre-approval, Guaranteed Rate’s commitment to issue you a mortgage specific for your desired home. To do this, your home purchase expert will verify your employment, check your credit and your debt.
As processing continues, your home purchase expert will collect other various documentation such as your credit report and other loan disclosures to verify your financial data.
You may be contacted multiple times during processing for any additional information that’s required for your specific mortgage or financial situation, so make sure you are available. To help speed up processing, provide your home purchase expert with as many organized documents as you can. Your mortgage cannot be processed without all necessary documents, including an appraisal and sales contract.
Your home purchase expert will update you during each step of the process.
A separate person knows as an “underwriter” will ensure that the property is in good condition and that you are able to repay your loan. In addition to making sure all necessary documentation is available, an underwriter will analyze your mortgage application to decide if your loan is a good investment for the company.
Based off this review, a formal loan decision will be made and your home purchase expert will contact you shortly afterwards.
Your mortgage is fully approved and you are ready to set up a date to close your loan! This date should be determined by you and the sellers of the home, along with any real estate agents involved in the home purchase.
At your closing you will be joined by your home purchase expert and real estate attorney who will ensure that your final mortgage documents are neat and tidy. During your closing, you’ll sign a wide variety of documents, including your mortgage note and HUD-1 Settlement Statement, the final document detailing the transaction between the buyer and seller.
When complete, you’ll walk away a homeowner!