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All About Mortgages
Overview
Now that you have hunted and searched and have finally found the home you want, it is time to find your loan and get the process going. You are all geared up and excited, but what do you do next? There are a few things you should know and understand which will be discussed in this overview.
The who, what, when, and why of a mortgage loan
Most people, when buying a house, need additional financial help in getting the money needed. This help is called a mortgage loan.
The mortgage loan is an agreed upon sum of money that a mortgage lender loans, with interest, to an individual buying a house. During the process, the buyer must be pre-approved for a loan, which will actually fund, or become tangible money, after the closing date of the house.
Basic steps of the mortgage process
In the mortgage process, many people will do certain things at different stages. These stages are broken down here as the application, processing, underwriting, and closing stages.
Application Stage
When applying for a mortgage loan, the lender will look at a few different factors. These include, but are not limited to, the purchase price, assets of the borrower, debt to income ratio, borrower’s credit rating, residential history, and personal information.
Processing Stage
During this stage, usually the real estate agent will cover the details. Things done include ordering the credit report, ordering an appraisal on the property to be purchased to ensure that it is not going to lose its value, and confirming the documents submitted in the application stage.
Underwriting Stage
The final process of the pre-approval of the loan is the underwriter. This is the person or institution that will take into account the many formulas and factors in the application and make the final decision about whether or not someone is a reliable borrower and capable of repaying the loaned funds.
Closing Stage
This is often the most anticipated stage of the entire process. Usually the buyer will just sit back and wait for this day to arrive, but behind the scenes, much is left to be done. Your real estate agent will orchestrate these events in conjunction with the title company and lender. These events include researching the title, ordering title insurance, ordering a survey of the property, preparing the final accounting, and after the final signing between the seller and the buyer, disbursing funds.
It is possible
The best things any person looking to buying a home can do are find the right people to help and educate themselves on the process so they understand what is going to happen. With these valuable tools, anyone can successfully maneuver through the mortgage process. |
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