The Loan Process

You have decided to purchase a home but are not sure where to start. The best way to get started is to GET PREQUALIFIED FOR THE LOAN FIRST. The loan is the most important part of the transaction because most people do not have the cash to buy a home out right. The LENDER of your choice will ask you for certain paperwork in order to verify income, credit and assets. These three items are needed to give you a pre-qualification letter which will be given to your real estate agent when he or she makes an offer on your behalf.

What type of loan do you need? Choose from the following to learn more about Specific types of Loans:

Conventional Loans FHA Loans VA Loans

The next thing to do, is to choose a REAL ESTATE AGENT, this person can be recommended by a family member, friend or by the lender. This person is now working for you! You can give the agent the information given to you by your lender which will include the maximum sales price you can qualify for and the type of loan needed in order to get you qualified. Through a series of questions by the agent, he or she can determine which properties to show you.

After you have selected the property, your agent will present an offer to the seller and his/her agent. This may take a few days and several counter offers before the final contract is accepted. When this is done, the agents will OPEN ESCROW An escrow is a neutral third party selected to gather information on behalf of both parties (BUYER AND SELLER).

A TITLE COMPANY is selected by the agents to insure you receive clear title to the property upon transfer.

Meanwhile, the lender is processing your loan and gathering up information regarding your employment, credit, and assets. Verifications are sent to the appropriate parties to verify this information. Escrow instructions as well as preliminary title report are sent to the lender to be included in the loan package. An APPRAISAL is done on the property you have purchased to determine the VALUE and the house The appraiser will note if there are any DEFICIENCIES on the property. If there are any noted, they must be corrected before the close of escrow.

After all the paperwork is received, the loan is submitted to the underwriter for loan approval. He/she may ask for additional documentation to support his/her decision to approve the loan. At this time, final loan documents are ordered and sent to ESCROW. You will be required to sign several items in order to facilitate the close. The escrow officer is finalizing the file by collecting any other items such as the TERMITE report and completion, insurance policy for your home, and any other items requested by the investor. Usually within a few days, the loan is funded and the following day the deeds are recorded. THE PROPERTY IS NOW YOURS!

CONGRATULATIONS ON THE PURCHASE OF YOUR NEW HOME!