Understanding the home loan mortgage process doesn’t need to feel like a maze. If you educate and prepare yourself prior to the home search, the process will move seamlessly.
The first step in the mortgage loan application process is a self-assessment. You must take a look at your financial situation – consider your savings, credit/debit, and documentation preparation in advance. You should also develop your monthly housing budget, as well as evaluate your emotional readiness for the process.
The next step is to request a pre-approval. This is an important step, because it will tell you what you can afford prior to finding a home. Having your pre-approval in hand as you begin your home search adds credibility with your real estate agent and the seller.
Our mortgage loan application asks for information on the property you are buying, as well as the employment and financial history of all loan applicants. We will first verify the information shown on the loan application; therefore, it is very important to make sure all the information on the application is complete and accurate. Doing so will assure prompt processing of your application and approval of your mortgage loan.
You need to be thorough and precise in providing this information, so it is best to assemble information before you meet with us. For a detailed description of what the forms and information you may need to include, please see the Supporting Loan Documents and Forms page.
You will be asked to sign a section of the loan application form that contains your certification that the information you have provided is correct to the best of your knowledge, your promise to advise us of any material changes in the information, and your consent to verify the application data.
The last part of the application form requests information on the race and gender of the applicants. The Federal Government uses this data to monitor our compliance with fair housing and equal credit opportunity laws. Provision of this information is strictly voluntary on your part and has no effect on your loan application. We, however, are required by Federal law to request this information.
After the loan application has been completed, our loan processors will call to confirm the information you provided, send out the verification of employment and deposit, and order the credit report, property appraisal and other documents. The time it takes to receive these documents affects the length of time required for approval of the loan.
Within three business days after completing the application, we must provide you with a "Good Faith Estimate" of the anticipated closing costs. It will show costs associated with the loan settlement, such as origination fees, mortgage insurance, title insurance, escrow reserves, and hazard insurance.
Within the same three days Poli Mortgage Group will also send you a Truth-in-Lending Disclosure statement. This statement shows, among other things, the estimated monthly payment. The total cost of all finance charges on your loan is also shown, stated as an annual percentage rate (APR). The APR represents the dollar amount of finance charges you pay either up front or over the life of the loan, converted to an annual interest rate. Since the Annual Percentage Rate includes origination fees and other charges, as well as interest on the mortgage loan, the APR is usually higher than the interest rate of the loan.
Once the loan application has been submitted and processed, it is then turned over to the mortgage Underwriters. The Underwriter is responsible for reviewing the work of the Processor and they compare all facts related to the loan program guidelines, to ensure they meet all compliance regulations. The Underwriters may require additional information and/or documentation known as “conditions.” Once all conditions are met, the loan will be approved and moves through to the closing department.
Once the loan has been approved by the Underwriter, and all conditions met, it is sent to the closing department. Everything is reviewed for accuracy and the closing package is forwarded to the approved Attorney/closing agent. The closing agent in this transaction represents the lender and will conduct the closing on our behalf. The closing agent at this point runs the title search to make sure the property can be conveyed by the seller without any encumbrances. The closing agent checks the title and makes sure that the lender has proper insurance and any other necessary coverage.
The borrower may need to bring in a certified (or cashier's check) to cover any closing costs, up front escrows and any other monies required for closing. This information will be clearly documented for you prior to your scheduled closing date.
The closing agent will obtain the necessary signatures on the closing documents and disburse the money.