Mortgage Loan Process for Home Owners


1. Dream of a New Home

Every couple or a working individual has dreams of owing their own home. Owning a home is indeed a key to long term financial security and independence. Buying a home is the single most important economic decision in one’s life and one must be prudent and careful in selecting the appropriate mortgage lender. We offer unique and exceptional customer service with free loan analysis and recommendation of appropriate loan programs best suited to your needs.

Select a New Home to Buy

However, selecting a new home is another vital decision and it must be done with proper consultation and through a reputable real estate agency. Your home is your investment and your dwelling as well, and it must be selected with care. If you have not selected a home thus far and would like to buy one or refinance your existing home, we have the expertise to meet your home loan needs. Meet or call your mortgage analyst to find out how much you qualify for. Find out if you can lower your existing monthly payments on your current mortgage or get the cash you need. You can begin the loan application process by getting your loan pre-approved.

2. Apply to Purchase a Home or to Refinance

The key to start the loan process is to apply for a loan. Applying for a mortgage loan is merely a process to collect appropriate information regarding your income and credit history, however, it is the most essential step towards owing or refinancing your current mortgage loan. Don’t hesitate in applying for a mortgage loan, there is no obligation. Starting with the information you provide us, we will work to obtain mortgage loan approval that meets your home purchase or refinance needs.

3. Get Pre-qualified and then Get Pre-approved

Get pre-qualified. First and foremost it puts you in a position as a homebuyer to know exactly how much you can afford. In addition, as a pre-qualified buyer you have a stronger standing than a buyer who is not pre-qualified. It is an important advantage in today’s fast paced real estate market. Next, get pre-approved. A pre-approval shows that you have provided the complete paper work (listed below) and your mortgage loan has been underwritten and approved. A pre-approval is strongly suggested as it will show the seller of a home that you are serious and qualified. It will also help to close the loan quickly and get you into your new home ASAP.

4. Shopping for the Right Mortgage Loan

Looking for the right mortgage loan program can be difficult with so many types of mortgage loans to choose from. We recommend that a buyer consider some questions before buying a new home. Is this a starter home? Will I be moving in five years? How much can I afford per month? How much cash do I have available for down payment and closing costs? What will the payment be? Is this the right house for me? Is this the right mortgage loan program for me? Different loan programs work to your advantage in different situations. If you’re planning on staying in your home for several years a fixed loan may be best. On the other hand, if your goal is to sell in just a few years an adjustable rate with a lower initial interest rate or an interest only option may work more to your advantage.

Another key factor in understanding different mortgage loan programs is to be aware of the relationship between points and interest rates a buy down rate. The more points you pay the lower the interest rate may be. A point is considered prepaid interest and is tax deductible. Each point is one percent of the loan amount. Paying points on your loan can lower your interest rate but increase your upfront costs.

Shopping for and comparing mortgage loans can be tricky. There are many loan programs, each with different rates and different points. What mortgage loan is right for you? We take pride in our seasoned loan analysts and their ability to help you choose which loan is appropriate for your goals and needs.

5. Organize Essential Documents and Get Credit Report

Purchasing a Home:

  • Last two years W-2s and current pay stubs covering one month for employees.
  • Self-Employed persons please provide the last two years of tax returns and an YTD profit and loss statement.
  • For rental properties please provide rental agreements and the last two years of tax returns.
  • The last three months of current bank statements for each account.
  • Copies of 401K, IRA, Pension or other retirement savings.
  • Divorce Decree, if applicable.
  • Bankruptcy papers (all schedules) and Discharge if applicable.
  • Name and address of your landlord, if applicable.
  • Letter to explain any derogatory credit.

Refinancing a Home Mortgage Loan

  • Last two years W-2 and one month of current pay stubs for salaried employees.
  • Self-Employed persons please provide the last two years of tax returns and an YTD profit and loss statement.
  • For rental properties please provide rental agreements and the last two years of tax returns.
  • Most recent mortgage statements on all owned properties.
  • The last three months of current bank statements for each account.
  • Copies of 401K, IRA, Pension or other retirement savings.
  • Divorce Decree, if applicable.
  • Copy of Homeowners/Hazard Insurance Policy
  • Names, address, phone numbers and account numbers of creditors to be paid at closing.

Get a Credit Report

Obtaining a credit report is essential and it has to be done in the early phase of the loan application and loan process. A lender is not in a position to offer or quote an interest rate or a loan program without knowing your FICO score or without examining your credit report. Perfect credit, not so perfect credit, or even bad credit doesn’t imply that you are automatically approved or can not be approved for a loan, and it also doesn’t imply that you have less chances with bad and more chances with good credit. It is merely a device to determine a loan program and interest rate, but an essential and necessary step that every loan applicant must take.

6. Select Mortgage Loan Program and Lowest Rate

Choose a Mortgage Loan Program

30 Year Fixed

20 Year Fixed

15 Year Fixed

10 Year Fixed

1 Year Adjustable Interest Rate (ARM)

2 Year ARM

3 Year ARM

5 Year ARM

7 Year ARM

10 Year ARM

Choose a Mortgage Loan Type

Jumbo Loan

Conforming Loan

Refinance with Cash Out

Refinance with No Cash Out

No Closing Cost Loan

FHA Loan

VA Loan

Cal Vet Loan

Imperfect Credit Loan

No Income Verification Loan

Commercial Real Estate

Equity Loan

7. Mortgage Loan Approval and Sign the Loan Documents

Once we have received your completed mortgage loan application, our loan approval process begins. This involves verifying the following information:

  • Credit report
  • Employment and income history
  • Personal Assets; bank accounts, stocks, pension, mutual funds, 401K, and IRA
  • Property value and title report

Additional documents or verifications may be requested depending on your individual situation.

Helpful hints to improve your chances for mortgage loan approval:

  • Fill out the loan application completely and clearly.
  • Provide requested documents requested in a prompt manner, this can be especially crucial if you have planned to close your loan on a certain date or have a rate locked in.
  • Do NOT make any large purchases. Increasing your debt can have a negative affect on your current application. Large purchases include, but are not limited to: automobiles, furniture, appliances, another house or time-share.
  • Bank account balances may be verified shortly before the close of the mortgage loan, be sure not to move money out of your account. If you move money into your account you will need to show where it came from. If you are receiving a “gift of money” from a friend or relative be sure contact your loan officer to get a form to use as a “gift letter”.

After your complete the loan application is approved and any additional items have been turned in your final closing documents will be drawn. You will be contacted for an appointment to sign them in front of a notary. After you sign, they will be returned to the lender for final review and funding. After the mortgage loan is funded and the money is disbursed, title to the home will record in your name.

8. You Now Own Your New Home!