Loan Process
Below is a sample of the loan process. I will work with you in the entire process to achieve your financial goal.
Pre-qualification and Application
Once I reviewed your financial information and run your credit report, I will issue you a prequalification letter in which your realtor will use it to negotiate a real estate transaction for you.
Meantime you complete a mortgage loan application and provide me the usual documentations regarding your loan application. I will then submit the loan package to the lender immediately for processing.
When you submit a written offer for a property of your choice and it is accepted by the seller, then you are in contract.
Lender Processing and Underwriting
The lenders underwriter reviews the loan package and decides if more information is to be needed from you. I will coordinate with you on this matter right away. As time is of the essence in a purchase and loan transaction, please respond immediately to the requests for additional information. This is very important as your prompt response to the request will facilitate the escrow process, meeting the deadline mentioned in the purchase contract, meeting the locked rate period and close the escrow on time.
I highly recommend that you get Pre-Approved
I mentioned Pre-qualification above. When buying a house, you may get pre-qualified or pre-approved. It is easier to get a Prequalification letter. A pre-qualification is not as beneficial as pre-approval where the lender process and underwrites your loan which includes a verification of your income, credit, assets and liabilities. It is highly recommended that you get pre-approved before your start looking for a house. This will help you:
1. Find out the maximum house you can buy, so you do not waste time looking for properties you can not afford.
2. You are in a strong position when you are negotiating with the seller, because the seller knows that your loan is already approved, which gives you the clout of an all-cash buyer.
3. Helps you close quickly as your loan is already approved.
Funding and Closing
The Escrow/Title Company of your choice will do a thorough title search of the property. I will coordinate with the escrow office and on closing you will sign the loan documents at the Escrow/Title Company office. When the lender is ready to fund the loan, buyer will pay the balance of down payment and closing costs to the escrow. When all requirements are fulfilled, the escrow closes. Congratulations to you! Your dream is achieved.
Note: On refinance and home equity loan transactions, federal law requires that you have 3 days to review the documents before your loan transaction can close.
Just a few words while your loan is in process.
- Do not make any major purchases. Do not buy a car, furniture or another house till your loan is closed. Anything that causes your debts to increase might have an adverse affect on your current application.
- Do not move money into your bank accounts unless it can be traced. If you are receiving money from friends, family or other relatives, please contact me.
- Do not go out of town around the closing date. If you do plan to be out of town when your loan is expected to close, you may sign a power of attorney, to authorize another individual to sign on your behalf.
Documents required in a loan transaction
Please provide me with the following documents to speed up your loan application:
1. If you are salaried, provide the last two years W-2 and one month of paystubs (two if semi-monthly or bi-weekly, or four if on weekly payroll).
2. If you are self-employed, provide the last two years tax returns and a YTD profit and loss statement.
3. Copy of last two months bank statements (savings, checking, CDs and mutual funds).
4. Recent copies of any stock brokerage or IRA/401K accounts statement.
5. Copy of child care statement or divorce decree if applicable.
6. If non-US citizen, copy of your green card (front and back), or if you are not a permanent resident, provide me with your H-1 or L-1 visa.
For a Purchase transaction:
7. Copy of fully ratified contract and all addendums.
8. Escrow Deposit Receipt
9. Gift letter, Proof of Donors ability to give and Proof of Receipt and Deposit of the gift fund.
For a Refinance transaction:
10. Copy of most recent mortgage statement for the 1st and 2nd loan.
11. If the 2nd loan is to be subordinated, copy of the 2nd loan promissory note or agreement.
12. Copy of your property insurance policy declaration.