Applying for a mortgage loan
After choosing your Realtor, and before shopping for a home, choose a lender and get preapproved for a loan.
Remember, getting preapproved is based on a preliminary review of your credit information and preapproves you up to a maximum loan amount. Because a preapproval includes a credit check, it’s more powerful than prequalification, which only estimates your potential buying power. Getting preapproved first will help you to focus your search for homes that fit your price range.
Once you have an accepted offer to purchase a home, the next step is to set up a loan application meeting with your lender. You will complete the loan application form which asks for information on the property you are buying, terms of the purchase contract, and your employment and financial history.
Your lender can provide you in advance with a list of documents you will need. Typically, documents include pay stubs, W2 forms, federal tax returns from the past 2-3 years, bank statements, and credit card and auto loan debt information.
Once you have completed the loan application, your loan officer gives your file to the loan processing department when information is verified and checked. Then goes to the underwriting stage, where the decision to approve is made.
Once there is final loan approval, it moves to the final step in the process: the closing. Documents are signed, fees paid, and title is transferred. At the closing, the house and mortgage are yours.