We wanted to talk about what you’re going to do in more detail with your lender, especially in the first week after you get acceptance of your offer.
Basically, you’re going to get with your lender so they can disclose to you the terms of your loan. They’re required by law to do this, and they’re actually required by law to have the numbers they disclose to you at the beginning match very closely with what the numbers are at the end. There can’t be any big increase in fees that catches you by surprise; if so, they’ve got to go back and readjust. Lenders don’t want that to happen, and neither do you, so it almost never does.
Once you meet with the lender, they’re going to run your credit if they haven’t already. They’re going to complete the loan application interview if they haven’t already – just some basic information about your employment, date of birth, Social Security number, where you’ve lived and so forth, income, expenses. They’re going to ask you to provide the last two years of tax returns and generally the last two months of bank statements. If you have investment accounts, other kinds of financial records that affect your application, they may ask for those as well. And basically, you can expect to get a checklist from them of what you need to bring to your appointment.? While you’re there, they’ll also get a check from you, typically for about $450, to order the appraisal of the property. Once that’s done, they’re going to wait till the appraisal comes back; they’re going to take all the information you gave them, and assuming it’s complete, they’re going to submit it to underwriting.
Once your file’s in underwriting, you should have loan approval in two, maybe at the most three days. Either you’ll get full approval with no conditions, or you’ll get what’s called conditional approval, where they’ll say “Well, you’re approved, but we need to see your most recent pay stub, your most recent bank statement,” or some other factor like that – which is usually pretty simple and easy to provide.
Once you’ve got that taken care of and have full approval, they’ll order your loan docs. They’re going to want to get verification that you have insurance in place, so just in case something happens to the home, that insurance will take care of it and that doesn’t turn into a problem for your lender. And they’ll generate the loan docs, which is basically the promissory note and other papers you’re going to sign just to take responsibility for the mortgage.
Your lender’s going to be keeping in touch with you week by week and as they need to about getting information, and we’ll certainly be there by your side in that process as well. And I think you’ll be actually happy and surprised how quickly they can move things along. We’ve actually had people close a purchase transaction in as little as 11 or 12 days after we got their offer accepted. Generally, it’s more like 17 to 21 days.
Some of the stories you may have heard from people are like 35 or 40 days or longer; that typically doesn’t happen with the lenders we recommend that you use, and the only thing that would really push the process out that far would be if you were taking advantage of down payment assistance. We’ll do another video on that, to go into that subject in more detail; it’s a bit of a specialized topic. So I hope this helps answer your questions about the loan process. If you have any others, please call, text, or email us. We’ll be happy to answer them.