The Home Loan Approval: Step by Step

The Home Loan Approval: Step by Step

Home loans in the Boca Raton area are like all other mortgages; they can all be a little confusing as far as the application process goes. Here at Nationwide Home Loans, we believe that knowledge generates confidence in your decision to get your new house. This article is a short list of steps to help you navigate through the various phases that are involved with the standard home loan process.The Home Loan Approval: Step by Step

The Mortgage Pre-Approval

The pre-approval process is a step that happens before the mortgage loan approval and even before you have started shopping or looking for a home. You can think of this phase as a type of pre-screening of your finances.

To get a pre-approval, your lender will look over your financial situation. They will take into consideration what your income is, what kinds of assets you have, how much debt you are in, and your credit score. The lender will assess this information to determine if you are a qualified applicant for one of their loans. This process provides you with an amount that the financial institution is willing to lend to you. They will give you a letter that declares your preapproval for the amount they have told you.

This phase is an essential step in the application process. It allows you to know the price range of home values to seek out. Without this pre-approval process, you could end up looking at houses that exceed your budget.

House Hunting

Here are a few steps that will make the house hunting process easier.

  • Make a list of what you need in a home.
    • Pricing.
    • Rooms, bathrooms, kitchen, etc.
    • Additional amenities, garage, yard space, etc.
  • Find a realtor. Agents aren’t required; however, they can help with the following:
    • Finding homes that are in your budget and have your expected needs.
    • Facilitating viewing of the properties you choose.
    • Helping with price evaluation.
    • Helping you decide on an amount to start the offer process at as well as presenting your offer.
    • Negotiating the sale on your behalf.
  • Shop online listings.
    • Utilize the different online search engines to help screen several homes based on prices, sizes, locations, and appearances. 
    • Visit the homes.
    • Bring a list of needs.
    • Take photos of the house. 
    • Take note of the neighborhood.

The Home Loan Application

The Home Loan ApplicationNow that you have found a home that is everything that you need, you have made an offer to purchase it, and the seller has accepted your offer, the next step is the actual mortgage approval procedure. That is just a different way of saying loan application.

During this step, you will typically fill out a standardized form. This form is known as the Uniform Residential Loan Application. This application requires information regarding the property you are purchasing, the type of loan you will be getting, as well as personal information about you and your finances.

The Mortgage Processing

After you have obtained the purchase agreement and finished the application for the loan, your file will go into processing. During this procedure, a loan processor collects various documents about you, your finances, and the property. The loan processor will make sure that your file contains:

  • Bank statements
  • Tax records
  • Employment letters
  • The purchase agreement
  • Mortgage Underwriting

This step is where the loan approval or denial happens. The underwriter carefully reviews all of the documents prepared by the processor. The underwriter makes sure that the file complies with all of the lending requirements set by the financial institution. They focus on the borrower’s capacity to pay, the borrowers credit history, and if the borrower put up any collateral on the property. With this information and the documents in the file, the underwriter determines if the borrower can be approved.

The Approval and Closing

If the underwriter decides that the borrower and the property meet the guidelines set out by the lender, they will say that it is ok to close. The phrase "ok to close" indicates that the file meets all requirements and that the loan is approved. At this point, you review all the documents. After the paperwork is signed, the home is yours.Nationwide Home Loans in Boca Raton

Nationwide Home Loans in Boca Raton

NHL Lending offers the best home loan rates in the area, as well as a wide variety of mortgage options. We have a streamlined process that makes the home loan application process easy. Our team will present you with all our programs and make sure you understand all of your choices. We want to offer you a helping hand with each step and assist you in a way that will allow you to be confident in the decisions you are making for your future.

By |2020-03-12T12:38:23+00:00November 20th, 2018|blogs|Comments Off on The Home Loan Approval: Step by Step