What happens during the mortgage process?

So you have met with a lender and they said you were approved- now what??!!  What happens after you have written a purchase agreement?  The process can be simple, but there are times that it doesn't seem that way!

When you meet with a loan officer, you give them all kinds of documentation – paystubs, w-2's, bank statements, court decrees, etc.  It may seem like you give your life history and in a way you do.  Once you meet with a loan officer, they will pull your credit report and calculate your income.  They will complete a loan application with you and run a loan approval through an automated system.  After you write your purchase agreement, they will get a copy of it.

Once you know your inspection on the home is ok, the loan officer or the processor will order an appraisal. They also order title work.  There are several things done behind the scenes that you don't see.  There is an IRS 4506T form that is sent in to get a copy of your tax transcripts to make sure the income matches what we are using.  There are employment verifications done and we verify the cash needed for closing.

After all of the verifications are back, we send the file to underwriting.  They will verify that everything is accurate and that the borrower has the ability to pay the mortgage.  Once we get the loan approval back, we make sure we meet any underwriting conditions and the loan is clear to close.  At that point, the closing department will send a package to the title company for the final forms that you need to sign.  There is a settlement statement that is approved by the closing department and that shows what you need for money for closing. 

Once everything is completed by the title company and the closing department, you come to closing and get to sign all the documents that put you into title on your new home!  The title company goes through all the documents with you and collects the money you need for closing.  You will get copies of everything and a set of keys to your new home!!

It can be very simple or there can be little road blocks that come up during processing your loan application.  Sometimes they are completely unforeseen – such as a IRS rejection of your 4506.  That may involve a phone call with you and the IRS to get the issue resolved.  Sometimes you need to make a conference call with the credit bureau to verify student loan payments or maybe that an account is closed.  Sometimes you won't need anything other than just an updated bank statement or paystub.  Expect to hear from your loan officer during the process.  There are times I rarely call my borrowers as everything is going very smoothly, other times we talk frequently!!

Once you close, you get your keys and you get to move into your new home!  For some reason, I tend to be busy the day you are moving!!  Have fun and enjoy your new home!

Leslie Vanderwerf,  NMLS ID#335509, American Mortgage & Equity Consultants – EmailWebsite

Written By

Currently a Senior Loan Officer at Cross Country Mortgage LLC, it's hard to believe I have been in the mortgage business for more than 25 years and have worked with Sharlene since 2000! I love sharing mortgage insights here each week and helping people finance their homes. Listening helps me find the right program for you!

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