The exciting experience of buying a house also involves, exhausting procedures, especially... Read More
A real estate agent is the one who helps you in identifying the home of your choice and dream... Read More
The exciting experience of buying a house also involves, exhausting procedures, especially when financial matters are concerned. Right from finding the right mortgage plan to closing the mortgage process, the challenges involved are countless deeming the entire experience, adventuresome.
Even though buying a house is not a cakewalk, it can certainly be an agreeable-walk when you contact, the right professionals, follow the right instructions and importantly, while you do your proper homework and research. When you regard the mortgage process, there are certain vital steps, which you should be aware of, to make the process less intimidating and find more at http://www.whichmortgage.ca/articles/.
The life cycle of the home mortgage process, commences with ‘pre-qualification’and concludes with the ‘closing-process’, involving various functions and functionaries. Before going through the complete process, it is essential to understand about the significant authorities involved and the role played by them in achieving the smooth running of the process.
- Real Estate Agent
A real estate agent is the one who helps you in identifying the home of your choice and dream. By understanding your requirements, he or she suggests the fitting availabilities, considering basic factors like, schools, shopping malls, public amenities like parks, cost of living etc.
He or she acts as a mediator between you and the seller and concentrates on striking a benefiting deal for all the three of you.
- Loan officer
They are the authorities responsible for pre-qualifying your mortgage by thoroughly considering your financial position, credit performance, employment etc. They also help you in your loan application process by rightly informing you at the right time.
- Loan processor
These functionaries by accepting the concerneddocuments prepare the loan application for the underwriter to act upon. The documents they demand may include your employment information, your identity proof, credit card related information, your bank statements, property related information etc.
He/she is the crucial decision-maker who decides your chance of availing the mortgage. By carefully going through the loan process documents, he/she may approve or deny the mortgage citing suitable explanations.
- Real Estate appraiser
As the name suggests, he/she appraise the property you are planning to buy, to understand its complete market value by comparing it with similar qualified properties.
5 steps to mortgage settlement
Following are the crucial steps involved in the home mortgage process. Each and every step has its own significance and hence you should understand it thoroughly to avoid any confusions and conflicts.
This is the stepping stone of the entire process, in where the loan officer after thoroughly examining your financial background and employment position confirms on the feasibility of availing a loan.
If you are qualified, the loan officer might offer the pre-approval letter, with which you can approach the real estate agent to strike a deal.
- Loan estimation
Once you have showcased your willingness to apply for the mortgage, the loan officer by accessing your financial position, credit history, employment and value of the housing property, will issue a convincing loan estimate, which explains the loan amount offered, loan term, rate of interest and type, down payment etc.
It is in this step, you have to check for any hidden fee or penalties like pre-payment penalty etc. to save you from any future disagreements.
- Loan processing
The loan processor, by going through the essential documents relevant to the buyer and the property, prepares the evidences in an orderly manner for the underwriter to study and decide thoroughly.
- Mortgage Underwriting
An underwriter carefully examines the evidences prepared by the loan officer and cross verifies various buyer statements and evidences to decide on the result.
He or she weighs on various crucial factors like buyers loan paying ability, his/her credibility etc., by using his/her thorough knowledge and experience of this field.
After careful examination an underwriter might,
- Approve the mortgage offer
- Approve with certain conditions
- Ask for further proofs
- Deny the offer
- Closing Process
Once the underwriter has approved the process, the last step is the closing process, in where you are offered a ‘closing disclosure’ putting together the things mentioned in your loan estimation and/or any suggestions added by the underwriter.
The closure disclosure should not vary largely with the loan estimate document, especially, the details related to the mortgage type, rate etc. In case of any discrepancies you can fight for your rights legally, as it is lawful.
Once you have confirmed the accuracy of the document, you may have to sign the following crucial documents,
- Closure disclosure – elucidating the entire mortgage terminologies like principle amount, rate of interest, type, term etc.
- Promissory note – Your promise to pay the loan interest on time.
- Deed of Trust – Allowing the lender to enjoy the title ownership, unless and until the full payment of loan amount is made.
- Certificate of Occupancy – Your legal proof that stresses on your right to move in your new home.
All these processes might be intimidating for a beginner. Not to worry, as enough time is allowed between different processes to carefully decide and followsuitably.However, before confirming on a mortgage provider and type, compare them with other eligible providers and choose the best offered competitive rate and services to reap optimum benefits.