The Loan Process
Prequalification occurs before the loan process actually begins. Ken and his team will gather information about your income and debts, and makes a financial determination about how much house you may be able to afford.
It's a good idea to know the price point you are looking for on your new home before you start shopping for one! If you are refinancing the loan on your existing home, then the prequalification process should help you decide whether refinancing is a good idea for you and also help you to determine if debt consolidation would make sense for you.
The application is the beginning of the loan process and either occurs after you have found a property you want to buy or have determined that you wish to refinance the loan on your existing home. You complete a mortgage application for a particular loan program and supply all of the required documentation for processing. Various fees and down payment options are discussed at this time. The loan officer will deliver a Good Faith Estimate (GFE) and a Truth-In-Lending Disclosure (TIL) within three days that itemize the rates and estimated costs for obtaining the loan.
Processing of your Estimated Loan
Kens' team will prepare your file and make sure that we have all the needed documents in order to submit your file to underwriting for their review. We will submit the application package to an automated underwriting system that will provide the lender with the necessary documentation needed for loan approval. If we need anything additional or have any questions we will let you know.
On purchases we will have gotten the borrowers initial loan disclosures back and would have ordered the appraisal prior to going to the next step.
On refinances we will have gotten the borrowers initial loan disclosures back and would need for the appraisal to be back in our office prior to going to the next step.
Ken has in-house underwriting so that enables him to move quickly through this step once we have the file processed and ready to go to the underwriter. The underwriter is responsible for determining whether the application package prepared by the processor meets all the lender's criteria. If more information is needed, the loan is put into "Conditionally Approved" so that Kens team can contact the borrower and clear any conditions. We will work with you to clear all conditions to its commitment to lend, and then schedule a closing time.
Conditions to the lender's commitment may include issues with credit, income, or the property that may arise during the processing and underwriting process.
The closing will occur after all conditions are cleared and the lender issues a full loan approval. Once we have the loan approval we will then issue the required "Closing Disclosure (CD) for the borrower to acknowledge. Once it is acknowledged we will be able to get loan docs out after the required three day wait period has elapsed. Once the signing is scheduled and completed Kens' office will work with the title company to get your loan funded and recorded.
At the closing if you as the borrower are bringing in cash to close; those funds will need to be wired to the closing agent as they do not accept cash, checks or even cashier checks.
This is the point at which you finish the loan process and actually refinance or buy the house, subject to the lenders' loan.