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The Loan Process: 10 Easy Steps To Your First Home

The 10 steps to your home loan:

  1. Apply For A Home Loan –  You’ll fill out a loan application (which can be done over the phone) that includes information about your employment and income and lists your assets and debts.
  2. Check Credit – The loan process starts with a credit check, to ensure that you’ll be a good candidate for borrowing. The higher your FICO score, the lower your interest rate and the better your chances for loan approval.
  3. Determine How Much Home You Can Afford – Based on your gross monthly income and your debts (including your new home payment, as well as your other outstanding debts), we’ll use industry ratios to determine how much home you’ll be able to afford.
  4. Obtain A Good Faith Estimate – Once you’ve found the home you want and submit an offer, we’ll provide you with a written good faith estimate that includes the terms of your home loan, as well as closing costs.
  5. Submit Loan Documentation – In addition to the loan application, we’ll also need to see copies of recent paystubs, tax returns, bank statements, and business records (if you’re self-employed).
  6. Get A Pre-Approval Letter – Once we understand your financial situation, we’ll write a pre-approval letter for you, showing the price range of condos, town-homes, lofts or houses that you can afford. This pre-approval letter shows sellers that you’re a serious, qualified buyer.
  7. Lock In An Interest Rate – At this point, you may choose to lock in an interest rate, so that you’ll be guaranteed a rate at closing, no matter what fluctuations occur in the financial markets.
  8. Have The Property Appraised – Before we can lend money on your dream home, we need to be certain that it’s worth at least the amount you’ve offered to pay the seller. We’ll send out an independent real estate appraiser who will compare your new home with others properties like it that have sold in recent months. Appraisals are designed to protect you, ensuring that you  don’t overpay for your condo, town-home, loft, or house.
  9. Receive Loan Approval – After we’ve verified the accuracy of all of the loan information and documentation that you’ve submitted, you’ll receive loan approval, and we can set a closing date.
  10. Close The Loan – This is the best part…you’ll come to the closing, sign paperwork, and walk away with the keys to your new home.

Every step of the way, in the home buying and loan process, we’ll be there – answering questions and providing support, and direction.