APPLICATION PROCESS Underwriting: Once the processor has compiled a complete loan file (i.e., the application and all supporting documents), the underwriter reviews the application in detail to make the final decision to approve or deny your mortgage loan. This includes reviewing your employment history, credit history, and the appraisal report. The underwriter also ensures your mortgage meets current loan product guidelines. If the underwriter requests further documentation, you will be required to provide it before going forward. This happens often, so don’t be alarmed if you’re asked to provide additional documentation. Loan Commitment/Approval: receive what’s called a loan commitment letter, which confirms your approval for the loan. This document outlines the details of your loan, including the amount being borrowed, the interest rate, and the term or repayment period. Once you’ve received your loan commitment, the next step in the process is closing on your home.
WHAT NOT TO DO DURING THE LOAN PROCESS Once you’re cleared to close, you may want to go out and celebrate by buying new furniture or appliances, but doing so could jeopardize your loan approval. Here are some steps you should avoid taking until you’ve closed on your home. • Don’t apply for credit (such as a new credit card, car loan, or financing for furniture or appliances) • Don’t make major purchases • Don’t liquidate funds • Don’t make large deposits • Don’t switch jobs
All of these factors could impact your final closing, even if you’ve already been approved.
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