These days, the mortgage loan process takes longer and involves much more paperwork to finally to get to the desired result…closing.  A mortgage loan file will contain much more documentation and verification than it did just a few years ago.  The following is a general idea on what to expect from beginning to end.

Application:
The mortgage loan originator usually takes verbal information from the borrower.  The borrower should provide as much information as possible at this time so that the originator can anticipate what type of paperwork will be needed for verification.

PreQualification:
The originator inputs the information into the origination software and hopefully generates an approved pre-qualification.  Some situations may not generate an approval, but may be a candidate for an underwriter to review manually.

Loan Disclosures:
Once a purchase address has been determined, the clock is ticking.  There is usually a closing date determined on the sales contract.  The originator will send disclosures along with a checklist of paperwork that will be needed from the borrower.  The borrower needs to sign and send back the disclosures along with the requested documentation in a timely manner.

Appraisal:
The originator will order an appraisal and the borrower will usually need to pay for the appraisal at this time.  A home inspection is highly suggested, but not required for the mortgage.  A home inspector will also expect to be paid at the time of inspection.

The borrower’s documentation will be reviewed by the loan processor.  There will be some third party verifications done at this time.  The processor may request more documents from the borrower at this time.  Once the processor feels that the file is mostly complete, along with the appraisal, the file will be sent to the underwriter.

Conditional Commitment/Pre-Approval:
Once the file has been reviewed by the underwriter, there will be additional conditions that will need to be cleared.  Once those conditions have been gathered by the processor, they will be sent to and reviewed by the underwriter.  Hopefully at this time, the underwriter will issue a Final Approval or a Clear to Close.

Closing:
Once the Final Approval is issued, the file will go to the mortgage closing department.  The closing date and time will be set and the mortgage closing department will send a pre-HUD/settlement statement to the closing agent.  The closing agent will finish the HUD and once the mortgage closing department, loan originator and the closing agent have all agreed that the HUD is correct, it will be sent to the borrower.  The HUD shows what amount the borrower will need to bring to closing, usually either by wired funds or certified funds determined by the closing agent.

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