Understanding the Mortgage Process
Buying a home can be overwhelming and the financing process can be a contributor to that stress. For many, it's a mystery what happens to their mortgage applications. Understanding all that is involved in underwriting your mortgage can help alleviate any concern that your loan is lost in limbo. Typically, from the time a mortgage application is completed, it can take from 30 to 45 days to close. Below is a general outline of the mortgage loan process. Keep in mind that every loan is different and if all parties, the borrowers, lender, and real estate agent aren't responsive, timing could be altered.
Submit your mortgage application. Make sure your application is complete and you supply all of the required documentation for processing, otherwise you could delay your application from the very start.
You will receive a Loan Estimate (LE) within a few days of your submitted application. This form provides you with important information, including the estimated interest rate, monthly payment, and total closing costs for the loan.
Next, the Credit Union orders a property appraisal and credit reports. We may also send requests to verify employment, bank deposits and any other documents needed to process your mortgage loan. All of this takes place between 3 to 10 days after your application was received.
The review and verification process is ongoing between 5 to 25 days after your application date. If an issue arises during processing, such as a credit report finding that requires written explanation or title or property issues, it could potentially delay the process.
The mortgage underwriter begins reviewing your loan package between days 15 and 25. They will determine whether or not to provide the loan. If there are any questions or additional documentation required, you will be contacted.
For a conventional loan, a borrower must obtain mortgage insurance when the down payment is less than 20% of the loan amount.
An attorney is engaged between days 20 and 30, title insurance is ordered, a municipal lien certificate is requested, all approval contingencies are satisfied, and a closing date is scheduled.
Your loan closing is usually scheduled between 30 and 45 days from when you first completed your application. Prior to the closing, we "fund" the closing attorney who disburses the funds to the seller or the seller's agent in exchange for the title to the property and recording at the Registry of Deeds.
Smile! You are now officially a homeowner!
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