There will be several major events that occur as you purchase a home. Some are related to the home purchase, and some to the mortgage application. Below are some things you can expect.

Apply For Prequalification Or Preapproval

Prequalification or preapproval is an informal way to see how much you may be able to borrow.

You can be prequalified over the phone with no paperwork. You can simply call your lender, provide them with your income, your long-term debts, and how large a down payment you can afford. Getting a prequalified mortgage puts you in a good position to begin house hunting.

Your preapproval is a lender’s actual commitment to lend you money for a home. It involves assembling your financial records, just as you would for an actual loan application, and going through a preliminary approval process. Preapproval gives you a definite idea of what you can afford and shows sellers that you are serious about buying.

Getting prequalified or preapproved provides you with more negotiating power with the seller and gives you preference in the event that the seller receives multiple offers. In addition, many real estate agents will work with you only after you have been prequalified or preapproved for a mortgage.

Find The Home You Want

When you’re looking for a home, you’re buying more than a house…you’re investing in a property that, if carefully selected, can appreciate in value considerably while you enjoy living in it. Before you buy, consider the home carefully and whether it suits your needs. Will it need changes, upgrades, or improvements, or is it perfect the way it is?

Make An Offer

Before making an offer on a house, you should have a good idea of its market value. What are comparable properties selling for? How long has the house been on the market? Do major systems require updating? Paying for a home appraisal can be helpful, but in the end, the price you are willing to pay should be a realistic reflection of how much you want the house.

Once Your Offer Has Been Approved, It Is Time To Apply For Your Loan!

Whether you are purchasing or refinancing a home, you will eventually need to formally apply for a loan. During the loan application, your Security Mortgage Loan Officer will review your credit, income, and asset information and begin the process of approving you for a loan. The loan application is the perfect time to ask lots and lots of questions and get the information you need to ensure a smooth and satisfying mortgage experience.

Get a Good-Faith Estimate

A good-faith estimate is an estimate that lists all fees paid before closing, all closing costs, and any escrow costs you will encounter when purchasing a home. The lender will supply this after your loan application has been completed, so you can make accurate judgments when shopping for your loan.

Understanding Your Closing Costs and Escrows

There may be closing costs customary or unique to a certain locality, but closing costs and escrows are usually comprised of some general costs.

General Closing Costs

• Appraisal fees
• Credit Report fees
• Document Preparation and Underwriting fees
• Loan Origination fees
• Loan Discount Points (where applicable)
• Investor fees
• Closing Settlement Attorney fees
• Title Search/Title Insurance fees
• Recording fees

General Escrow Costs

• Home owners insurance (you will need a annual paid receipt prior to closing)
• Property Taxes
• Interest Due (from the day of closing to the end of the month)
• Mortgage Insurance Premiums

Provide Accurate Information

Your primary responsibility during the lending process is to supply honest and accurate information to your lender. This will ensure that your lender can offer you the best mortgage with the best terms for you and your family. Following are some helpful tips to ensure you are providing the most accurate information.

• Be sure to read and understand everything before you sign
• Refuse to sign any blank documents
• Do not buy property for someone else
• Do not overstate your income
• Do not overstate how long you have been employed
• Do not overstate your assets
• Accurately report your debts
• Do not change your income tax returns for any reason
• Tell the whole truth about gifts
• Do not list fake co-borrowers on your loan application
• Be truthful about your credit problems, past and present
• Be honest about your intention to occupy the house
• Do not provide false supporting documents

Now that you understand your responsibilities and are ready for the commitment, it’s time to set your closing date.

Set a Closing Date

Your closing date will be specified in the Purchase Agreement you sign with the seller, and this document spells out events that must take place before closing. The closing date should allow you enough time to apply for and obtain a mortgage, and should take into consideration such contingencies as property inspections, the title report review, or other complications which may involve legal assistance. The lender may require certain repairs to the home before agreeing to fund the loan. Consult with your Security Mortgage Loan Officer to determine a date that leaves adequate time for all the loan procedures that lead to a successful closing.

We Know All of This Can Be Confusing... But Remember Your Security Mortgage Loan Officer Is There to Help.

It’s to your advantage to be exposed to some of the language and concepts of the home buying process before you begin seriously shopping for a home. But it’s your Security Mortgage Loan Officer’s goal to assist you all the way: to find the perfect loan for you, to make clear all the options open to you, to be available to answer your questions over the phone, and to attend your closing to help you understand the documents you’ll be signing.

Security Mortgage Loan Officers are experts at making your purchase of a new home an efficient and gratifying experience. They routinely seek out information on the latest developments in the mortgage industry, developments that can potentially provide you with a substantial savings when you take out your loan. Make certain your Security Mortgage Loan Officer knows how to contact you daily throughout the home-buying process, and don’t hesitate to phone them with your concerns and questions.