Anyone thinking of buying a home may be intimidated by the loan process.
Purchasing a home requires deliberate steps that result in a clear and non-confusing pathway to homeownership.
The loan process can be organized in five stages, each of which is important to the overarching goal of securing a loan, and moving into the home of your dreams.
If you’re prepared to find your dream home in this wonderful community of Roseville, read on to learn about what it’ll take.
Step 1: Figure Out Your Budget
Before beginning the exciting process of shopping for a home, one must determine how much home they can afford. This step is conducted by examining the applicant’s financial snapshot, including debt-to-income ratios, size of down payments and other information that’s revealed through the pre-qualification portion. Once these numbers are crunched, a lender can provide the loan amount.
Step 2: Choose a Home Loan Program
Home shoppers have the luxury of selecting from an array of financing programs that will help achieve their goal of buying a home at the right price. Generally, homebuyers can select a fixed-rate mortgage or an adjustable-rate loan program. These are the two basic loans from which to choose. Other features can provide additional financial flexibility depending on your goals and needs.
Step 3: Submit Loan Application
Now that you’ve figured out the size of your loan and its type, it’s time to apply. This formal process requires applicants to submit documents that outline and verify important financial information. These details trigger the lender to push the application forward once the buyer’s eligibility for the loan amount and terms are determined.
Step 4: Begin the Loan Process
At this point, a number of moving parts are set in motion, which are guided by government standards and loan-approval guidelines. The loan’s approval will be contingent upon the buyer’s ability to repay the loan and value of the property. These major factors are determined by carefully examining the applicant’s income, assets, credit scores, property appraisal/ inspections and other financial considerations.
Step 5: Close Escrow
Once all the details above are sorted out, a third party-led step is triggered. This is known as escrow. At this point, buyers will sign their financial paperwork, review documents and sign off on loan terms. As this is a formal process, a notary public will be needed. In addition to completing the paperwork, the closing costs associated with purchasing a home will also be paid for. Buyers will also have to show proof of homeowner’s insurance, if required by the lender, at this time. Other final documentation may be needed to finalize the closing.
When you work with us, you’ll work with seasoned loan officers who will provide guidance through each step of the loan process. We’ll also connect you with a loan program that fits your needs. We’d love the opportunity to work with you and provide a clear pathway to homeownership!