Buying a home is one of life’s most momentous milestones — especially when it’s your first. Of course, navigating the complex home buying process can be intimidating to even the most seasoned seller.

The key to a smooth, rewarding first-time home buying experience that prioritizes results instead of stress? Preparation. On that note, keep reading for an insider’s introduction to the home financing process, brought to you courtesy of Van Papadopoulos, Draper and Kramer, our exclusive Mortgage partner.

The 6 Steps Of The Mortgage Process:

#1 PRE-APPROVAL: With a pre-approval, you’ll be able to see how much financing you qualify for, set your
home buying budget, and prove to home sellers that you’re a serious buyer. Keep in mind that your pre-approval is based on your credit report, income, assets, and debt information.

#2 APPLICATION: When you officially apply for your mortgage, you’ll provide personal, financial, employment, and other information to determine which mortgage options and rates are available to you and help you choose a loan program.

#3 PROCESSING: After your application is accepted, our Mortgage Team processor will review your credit report, verify your debts, payment histories, and employment status, and order the title report. Your appraisal will also be ordered.

#4 APPRAISAL: The appraisal determines the fair market value of the property you’re financing to ensure that you’re paying an appropriate price. The appraiser will typically inspect the physical structure of the property and compare it to other homes in the area that have recently sold.

#5 UNDERWRITING: The underwriter will receive your loan file from the processor and review your application, documentation, financial information, sales contract, and appraisal to ensure all the necessary requirements for your loan have been met. They will then request conditions that must be satisfied in order to close your loan.

#6 CLOSING: Once you get the clear-to-close, and you’ll receive your Closing Disclosure (CD) at a minimum of three days before this date. On your closing day, which is set in your purchase contract, you’ll sign all the final documents, pay closing costs, and get your loan funded. Then, your transaction is complete!

Dos And Don’ts: No one likes surprises during the home loan process. Here are some tried-and-true tips around best practices — not to mention dangerous pitfalls and how to avoid them — from a team who has been there and done that.

DO:

– Have easy access to all your pay stubs, bank statements, and other financial documents
– Make timely payments on all current debt obligations (current mortgage, student loans, credit cards, etc.)
– Notify your loan officer immediately regarding any changes to your employment status
– Notify your loan officer if you plan to receive gift funds for closing
– Provide your earnest money deposit from your own personal bank account
– Ask any and all questions you may have throughout the process

DON’T:

– Omit debts or liabilities from your loan application
– Change jobs, become self-employed, or quit your job
– Buy a new vehicle or other big ticket item
– Use credit cards excessively or fall behind on payments
– Spend money that has been set aside for your closing
– Initiate any new inquiries into your credit
– Make large deposits
– Change bank accounts or move money between accounts
– Cosign on a loan for anyone

Ready to make moves? Connect with our team today to officially start the home buying process!