Buying a home for the first time can be a stressful process. There are many steps involved in purchasing a home. Oftentimes, one of the biggest stressors is the loan process, what steps are involved, and how long it takes. It can help tremendously to consider this process as a sequence of events.
Application
First, submit a loan application to your choice of mortgage lender to begin the loan process. Loan applications may ask for a lot of information, but that helps the lender learn more about you.
Processing
Next, the lender will begin by reviewing and processing your home loan application. During this time, they may request further documents from you, such as your pay stubs. The lender will also provide you with further details about the home loan, such as a general timeline for the remainder of the process.
Appraisal ordered
Once your home loan has begun processing, the lender will order an appraisal of the property. This will determine the market value of the property, or how much the property is worth.
Underwriting
During underwriting, the lender reviews all of the information and documentation you have provided thus far to begin the approval process.
Conditional approval
Once all of your documentation has been approved, you will receive a conditional approval. This lists the remaining requirements or conditions that must be met to receive full approval and clear to close.
Closing disclosure
You will receive a closing disclosure approximately 3 days before you close on your loan. This provides you with the terms of your loan, including the specific numbers of your monthly mortgage payment. If you have any questions at this step, it is important to ask your lender as soon as possible.
Clear to close
Clear to close is the last step before closing on your home. You will receive this notice to inform you that you are fully approved and ready to close on your home.
Closing
Finally, the last step in the home loan process is to close on your home. You will sign paperwork, make your down payment, and begin the loan on your new home!
