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The following FAQ (frequently asked questions) will help you understand the mortgage process and make those important decisions involved in buying a home. When should I start the mortgage process? How do I pick a mortgage program? What should I ask a prospective lender? What documents will be required of me to have my application processed? How long does the whole process take? What can I expect my costs to be for getting a mortgage?
When should I start the mortgage process? Many people are surprised to learn that the best time to look for a mortgage is BEFORE you look for a house. Beginning your adventure with the search for financing gives you plenty of time to pull together records you will need to get a mortgage when you finally find the home you want to buy. It's a big advantage to get familiar with mortgage lenders in your area in the early stages of your house hunting project. There are also two valuable thing you can carry away from your visits with lenders that can help make your home search a little easier.
There are many benefits in having a mortgage pre-approval, not the least of which is that it can eliminate a great deal of potential anxiety since you do not have to wonder about your credit rating or how much of a mortgage you're approved for. There are other benefits as well. Your offer to buy can be taken more seriously once you have finally found your dream home. Many offers today are made with contingencies, such as mortgage qualification, the sale of another dwelling, etc. When you indicate to the seller of the home you want that you have been "pre-approved" for a mortgage, your offer becomes more attractive. The seller knows that it's likely that a sale to you will "go through" and not result in costly and inconvenient delays. Closing on you new house will likely be faster and easier. The pro-approval process includes some of the steps that would be taken in the regular mortgage process. Since you will have already gotten those steps out of the way, your mortgage can be closed faster. There is typically a modest charge to obtain a mortgage pre-approval. This covers the cost of the lender obtaining and reviewing your credit report. To get a mortgage pre-approval, contact your mortgage consultant. How do I pick a mortgage program? The best way to know what type of loan program to chose is to estimate how long you plan to keep your home.
What should I ask a prospective lender? The following are good questions to ask a mortgage lender:
What documents will be required of me to have my application processed? In order to process your mortgage, your loan consultant will need several pieces of information regarding your income, debts and residency. You may be asked to provide other information such as the previous two years federal tax returns or specific financial documentation, particularly if you are self-employed, own rental property or have income such as commissions and bonuses. There's nothing like preparation to help take some of the anxiety out of the mortgage application process. An hour or two spent "pulling together" financial information can save many days of delays down the road Don't forget to use our Checklist of Items which is provided to help you ensure smooth sailing during the application process. How long does the whole process take? The length of time it takes from start to finish can vary with the complexity and details of your transaction.
What can I expect my costs to be for getting a mortgage? There are a number of costs associated with applying for and closing on a mortgage besides the house payment. /to begin with, there is a fee charged by the lender to obtain a credit report and conduct a formal appraisal of the property. This can range form between $350 and $500. In addition to this amount, which is due when you apply for the home loan, are closing costs. Costs associated with the closing can (but not always) include the following:
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Last modified: November 22, 2006
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Equal Housing Lender
FDIC Insured