Understanding The Mortgage Loan Process
STEP ONE - LOAN DISCLOSURES
Review and sign loan disclosures
- Make sure all information is correct.
- Sign and date the loan disclosures and return your income documents.
- Once returned, your loan will move into the processing and underwriting portion of the loan process.
STEP TWO - APPRAISAL REPORT AND TITLE POLICY
Appraisal Report and Title Policy - These are ordered at the same time your loan disclosures are sent.
Appraisal - It determines the value of your home based on its present condition and comparable sales in the area.
An appraiser will contact you to schedule an appointment to inspect and photograph your property.
After the appraiser visits your property, it typically takes three business days to generate an appraisal report.
Title Report - The title policy will reflect all liens against your property. This policy protects you by making sure no other person or entity has a claim to your property.
STEP THREE - THE PROCESSING OF YOUR LOAN
After the title policy and appraisal are ordered, our staff will begin requesting all of the information an underwriter will need to approve your loan.
Items needed for loan approval
- verification of your employment history
- a payoff statement for your current mortgage
- a verification of your mortgage history
- insurance coverage for the new loan amount
Once these items (including the appraisal report and title policy) are received, your loan will be submitted to underwriting.
STEP FOUR - THE UNDERWRITING OF YOUR LOAN
The underwriter will review the submitted documents and issue a decision about your loan.
Conditional Approval - An underwriter will approve your loan with "conditions."
Conditions - Any items an underwriter needs to further clarify in order to issue a final approval (i.e. title questions, income/employment documents, home inspections, etc.. .) - Our staff will contact the necessary people to satisfy all of these conditions.
*** Please be aware, you may be contacted at this point to provide additional information ***
Final Approval - Once all conditions are received, they are forwarded to the underwriter for final loan approval.
The underwriter will review the submitted conditions and approve the loan.
STEP FIVE - THE CLOSING OF YOUR LOAN
Once a final approval is generated, your loan will be submitted to the closing department to prepare closing instructions and documents.
At this point, we will contact you to schedule a convenient closing time and date between you and the title company.
We then coordinate with the lending company and title company to make sure all closing documents are prepared correctly (this ensures a smooth closing).
IMPORTANT THINGS TO REMEMBER
The loan process takes approximately two to three weeks from the time we receive your appraisal report and title policy.
Be sure to maintain your existing credit profile during the loan process, as changes in your credit profile can alter the terms of your loan. For example:
- continue to make all mortgage payments until the loan closes
- pay all bills
- do not attempt to buy any high-dollar items
- do not allow anyone to pull your credit report
OUR GOAL
Our goal is to provide our clients with the highest level of service and satisfaction throughout the loan process.
When navigating the rough seas of the current real estate market, you need a real estate professional with practical experience negotiating distressed sales. Over 70% of real estate sales in July 2010 were either a short sale or a bank-owned foreclosure (REO). This means that the bank was the ultimate decision maker in the price of the home and any concessions made to the buyer. Depending on your market, it is common to find yourself in a multiple offer situation, which can be a lengthy and extremely frustrating process. Can you afford to have an agent who "does real estate in their spare time"? Everyone has a favorite aunt or a neighbor in the "biz", but is that person the right person to help you negotiate the single largest financial and legal transaction that you may ever conduct?
At Merchants Realty & Loan Corp, real estate is our profession, not a hobby. Our agents have negotiated hundreds of short sales and foreclosed properties. They understand that presenting an FHA offer with 3.5% down is not always the most attractive offer to be reviewed by a bank, BUT they know how to present the offer the right way to get the most favorable results. Combined with a rock solid loan approval from our mortgage department, a Merchants Realty & Loan offer to purchase has a 75% better chance of being accepted than an offer from any other real estate firm.
Why is that?
At Merchants, both our real estate professionals and our mortgage professionals have a deep understanding of current market conditions and know exactly how to prepare the loan package and ultimately the offer to purchase real estate. Our loan process begins with an in depth analysis of the borrowers income, assets and credit. Merchants will only present an offer that has been through the underwriting process and has the underwriter's signature on the approval. This guarantees the seller and/or the bank that a Merchant's borrower can close as quickly as a cash buyer. Once the contract is accepted, only an appraisal is needed and the transaction can be prepared for closing. It is this unique process that separates Merchants from all competitors. Furthermore, you are not required to have perfect credit to obtain loan approval. The mortgage professionals at Merchants are experts at credit score optimization and with one phone call, can estimate the time it will take to obtain approval based on current credit scores regardless of how low the scores may be. This recent recession has left over 50% of Americans with mid to lower credit scores, many unjustly, and we feel there is real value add to assisting those folks with restoring their credit scores.
