The First Time Homebuyers Guide to the Mortgage Process

Overwhelmed with the Mortgage Process? This guide is for you!

Buying a home is sure to be an exciting time in your life! However, whether you’re a first-time homebuyer or a seasoned homeowner, the mortgage process can be stressful and overwhelming. With so many moving parts, documents, and deadlines, it’s important to have a basic understanding and a lender you can trust to guide you through the mortgage process. If you find yourself faced with questions about the mortgage process, this guide is for you!

Understanding the Mortgage Process in 7 Simple Steps!

  1. Find a Lender

Finding a lender you can trust is the first step in the mortgage process. Many people think that the mortgage process doesn’t start until you’ve found a home you’re ready to purchase. This is not the case. In fact, most real estate agents will require you to be Pre-Approved before you even start looking for a home. (Learn all about Pre-Approvals and why my Homebuyer Advantage Program gives you a step ahead of other buyers!) Once you’ve found a lender you can trust, you’re ready to begin house hunting! When you find a home you love, your mortgage lender can help you determine what your monthly payment would be on that home. Remember, your lender is there to be a resource for you and to guide you through the mortgage process ensuring that you find the mortgage that best meets your needs. Don’t be afraid to ask questions!

  1. Submit Your Application

Now that you’ve found a lender you trust and the home you want to purchase, the actual mortgage process begins. The first thing your mortgage lender will do is have you fill out a full application. You’ll need to make sure you have the following documents:

  • Last 2 years of W2s
  • Last 2 Pay Stubs
  • Most recent Bank Statement (all pages)
  • Copy of Driver’s License
  • Name/Number of Insurance Agent

PRO TIP: Make sure that you are responsive to your lender!! Once you qualify and your application is submitted, you’ll receive conditional approval. At this stage, your lender may require additional documentation. To keep your application moving forward, it’s imperative that you respond in a timely manner.

  1. Home Inspection & Homeowner’s Insurance

Scheduling a home inspection is one of the most important things you can do while purchasing a home. Make sure you do this soon after your offer is accepted. Doing so will give you adequate time before your closing date to negotiate with the seller if the inspection reveals any unforeseen issues. You’ll also need to purchase homeowner’s insurance for your new home. Your lender will require proof of insurance before your loan can receive final approval.

  1. Appraisal

At this stage, most of the work is being done by your lender behind the scenes. Your lender will order a home appraisal to ensure that the value of the home you’re buying corresponds with the purchase price. In order to do this, the appraiser will visit the home and compare it to other recently sold homes in the area. Your lender will also order a title search to make sure there are no outstanding liens on the property.

  1. Avoid New Debt

While your loan is processing, avoid opening new credit cards and making large purchases that could impact your finances. New loans or other changes that affect your debt-to-income ratio could negatively impact or delay your mortgage approval. This also includes any changes to your employment.

  1. Lock-In Your Rate

It’s time to lock-in your rate with your mortgage lender. Your lender will provide you with the best rate possible and walk you through what this means for you. You’ll need to lock in your rate no more than 10 days prior to your closing date.

  1. Closing

Once your loan is approved, your attorney will set a closing date and provide you with a breakdown of the amount of money you’ll need to bring to closing, which will include your down payment and closing costs, among other items. You’ll need to get a cashier’s check or arrange to wire money to cover your down payment and closing costs.

At the closing, be sure to read all the documents you receive and ask any questions you may have about the terms of the agreement prior to signing.

Once you’ve signed the paperwork, it’s time to pop the champagne! You’ll receive the keys to your new home!

Do you still have questions about the Mortgage Process? Contact me! I would love to answer any questions you may have and be your go-to resource.

If you are in the market for a new home or thinking about moving down the line, I would love to help you navigate the mortgage process. Let’s get started!