Step 1 : Get started on the loan application. It can be done on the phone with a loan officer or even apply on the Internet. Make sure it is completely accurate and complete, or they might deny the loan.
Step 2: Loan processing. Once the application is complete, it will go to a processor. They will analyze all the numbers like your income and how much cash you are bringing into the deal.
Step 3: Underwriting. After it has been processed, it will go to the underwriter and check all the mistakes (if any) that the processor/loan officer made. They will also check everything to see if the requirements of the loan have been met. They will then decide if the loan application is approved or not.
Step 4: Closing and Funding. Once the underwriter approves the loan, it will go into closing. Closing is the process where the lender's office communicates with the title company in order for settlement. At this stage, the money is made available for the loan.
Step 5: At the Settlement Table: The paperwork is done. The buyer and the seller will meet and sign contracts.
Step 6: The Closing Costs. There are many closing costs that have to be paid. They are like bills/taxes when you finish sealing the deal.
Why are down payments Important?
1) You can eliminate Private Mortgage Insurance.
2) Small mortgage, which means less interest paid.
3) Instant equity.
Time is of huge importance for your mortgage loans. The shorter your loan term, the larger your payments have to be to get that loan paid off in time.
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