After receiving your quotes the next step of this process will be to complete the loan application form. At most financial institutions the loan applications are then uploaded to an electronic approval system which will proceed to compare all of the items appearing in your application to predetermined qualifying criteria which is required by the type of loan which you have chosen. If you are qualified the loan officer will provide a detailed quote of current mortgage rates for your situation.
The mortgage process can be a complicated affair and people looking to buy a new home or refinance an existing one may require a lot of professional advice and as much information as they can obtain so they can get the loan which they need. Mortgage companies will investigate employment status, credit history and people’s financial standing and this process can be detailed and then there’s the waiting period to see where the loan will be approved or not. This is why people may benefit from understanding what the entire process is all about. In most cases, people will eventually find the lending institution which feels right for them and they will also decide on a suitable loan program.
Do You Qualify?
Should it eventually be determined that you have satisfied all of the needs for the loan approval because of your ability to show an acceptable debt to income ratio (this means you have proven that you are able to handle the payment) that you have adequate assets (if required), then an automated preapproval is generated by the system. There are some conditions which need to be complied with such as that you will have to provide proof that you have abided by applicable legislation and have also been completely honest during the application process.
All that remains for you to do is to provide information which is now required by the loan system such as bank statements, tax returns, and W-2 forms and pay slips. You will have to provide adequate proof of your identity such as documents containing your Social Security number. It is important to have all of these documents ready for checking so that your identity can be quickly verified. After successful collection of old documents your loan application, as well as all related documents, will then be submitted for full underwriting. If you are not able to make it to full underwriting because of your credit score you’ll want to find information online for credit score improvement tips.
The Underwriting Process:
All of your documentation will be validated once your loan application reaches an underwriter. Only after everything has been checked out which does not take very long a conditional loan approval is granted to the loan applicant. They are unfortunately some occasions where the applicant’s files can be denied or suspended and such documentation is then returned to the mortgage loan processing department.
Nevertheless, once the conditional loan approval has been done the applicant will be required to provide more documentation before the underwriter will grant final approval. Some of the things which may be required could be a pay slip and they would also require proof of employment and there may be something’s on your credit history which may need additional explaining. As soon as the loan applicant has submitted all of these documents to the loan officer it can take yet another day for all of the documents to be reviewed by the underwriter.