Buying a home is a big decision, and if it’s your first mortgage it may seem daunting. But don't worry, the experts at Standard Mortgage are here to help you understand what happens at a couple of the most important steps of the mortgage process. Underwriting and closing are critical aspects of your mortgage experience, let’s take a closer look at each one.

What is Mortgage Underwriting?

Lenders evaluate your creditworthiness and ability to repay a mortgage loan through a procedure called underwriting. Your financial details, including your credit report, income and bank statements, and debt-to-income ratio, will be examined by your mortgage lender’s underwriting department. They will also look at the property you are purchasing (appraisal information and comparable home sales in the area) and the state of the market.

The time required for underwriting can range from a day to a few days. A conditional acceptance letter will be given to you if the underwriter accepts your loan. The terms of your loan, such as the interest rate, payment amount, down payment, and closing expenses, will be described in this letter.

What is a Mortgage Closing?

The last stage of the mortgage application procedure is the closing. At this point, all the papers will be signed, and you will formally own your home. You will be required to make a down payment, cover closing expenses, and sign a mortgage note at closing.

The actual loan closing takes place at a title company office and only takes a few hours. It's critical to have all the required documentation and cash in place in order to be ready for closing.

Tips for a Smooth Mortgage Process

Before you begin looking for a home, get pre-approved for a mortgage. This helps the process of buying a property go more easily and will give you an idea of how much you can borrow. Use a dependable lender who has knowledge in helping first-time home purchasers. Prepare any required documentation, such bank statements, paycheck stubs, W2 forms and tax returns, to be given to your lender. The mortgage application process may seem difficult, but it doesn't have to be. You can speed up the process by paying attention to these pointers.

For over 90 years the staff at Standard Mortgage (NLMLS#443912) have been helping homeowners and homebuyers find the best solution for their mortgage needs.