Make sure you check with your "Loan Officer" and your "Realtor" on what they recommend for the number of days needed to close on your loan for your Purchase and Sale Agreement! 45 days is typcial, however, 30 days is attainable if all necessary documents are provided in a timely manner and no issues arise during the process: i.e, inspection issues, appraisal issues, credit score change, etc.
Step One: The Loan Application
Filling out a loan application is the first step in obtaining a mortgage. You'll be asked to provide financial information and documentation along with personal information to obtain your credit report. It's important to make sure your documentation supports the information provided at the time of application.
Step Two: Loan Processing
Once your loan application has been completed and necessary documents collected, your loan officer will provide you an opinion of credit worthiness while evaluating your financing options. All paperwork will be organized at this time in preparation for submittal for underwriting.
Step Three: Underwriting
Once your paperwork has been prepared for submittal, it will be forwarded on for underwriter review and ‘conditional’ approval pending any further documentation required. It is typical for the underwriter to require items such as a satisfactory appraisal and additional documentation which may include an updated pay stub, bank statements, acceptable payment history for other items, and proof of no title issues on the property, etc.
Step Four: Closing and Funding
After an underwriter has approved your loan for closing, a typical 48 hour processing time will apply before final loan paperwork can be signed, and funding can be received. With this in mind, a meeting time suitable for you and all parties involved can then be scheduled with the attorney performing the loan closing. All paperwork is reviewable at this time, and questions are welcome.
Closing Costs: What to Expect
Fees associated in obtaining mortgage finance vary depending on the type of loan you are applying for. It is always wise to ask questions when consulting with your loan officer, as out of pocket costs can be expected even when applying for 100% financing. Some of the fees may also be included in your loan depending on the program.
Typical out of pocket costs are:
Earnest Money Deposit – A down payment associated with the purchase of a property.The amount varies per transaction, and can be determined by consulting with your realtor.
Appraisal Fee - A third party fee paid to an appraiser to determine a fair valuation of the property for which you are applying for financing.The fee varies based on the individual property.
Hazard Insurance – An insurance policy typically referred to as “homeowner’s insurance” that covers your property in the event of damage as outlined in the insurance policy you obtain.You are free to obtain insurance through an agent of your choice, and premiums are based on quotes from that agent.The purchase of a new home requires you to pay your first year’s premium in full prior to your mortgage being finalized.
Inspections/tests that may or may not be a bank requirement.
Note: 100% USDA Loan – if all closing costs are not able to be included in the loan – be aware there may be funds needed at closing – typically very limited. This is on a case-by-case basis.
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