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Basic Steps In Mortgage Loan Processing

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By Edited Nov 13, 2013 0 0

What You Can't Ignore About The Loan Process

There are certain steps to any mortgage loan processing. This accounting procedure normally last for a period of 7 to 10 weeks and it involves a time consuming and complex procedure. The borrower ensures that he adheres to all instructions of the lender as he oversees the whole process. If you want a loan for a house, it is vital that you understand these processes. These procedures are the same for all lenders but there are slight variations. Below are the basic steps for mortgage loan processing.

Mortgage Application: After you have choosing your lender, an application is usually the first thing to do. You have to fill the form and provide the necessary details required of you. Nowadays, the application process is easier as almost every form filling is done online in the lender’s website. After submitting the form, the mortgage processor will then contact you, requesting you to submit some documents. These will include your income tax returns in case you are self employed, your pay stub and a recent bank statement.

Verification of Information: This is the second stage after your documents have been submitted. It is when the actual mortgage loan processing begins. These lenders are dealing with risk here so they must make sure the loan they are giving out must be repaid. This is why the go through the process of verifying each document to ensure that they are all genuine. They will speak on phone with your landlord, bank, employer, or any other verifiable name in your document. It is after the documents are verified that the overseer will then take your file to the mortgage lender.  He will begin your appraisal process and finish within 2 weeks depending on the eligibility of the house loan.

Loan Underwriting: Here, the underwriters will reevaluate your documents again and request you to send your credit report. The title report and appraisal will also be confirmed. You should also know that the underwriter has the sole right to accept or reject ant file he chooses based on his own validation. On acceptance of the file, it will be taken to the loan processor for final approval. But if the file is rejected by the underwriter, it will be sent back to the mortgage loan processing unit for second review to find out if there is a way to help the borrower. The introduction of the automated underwriting technique has made mortgage loan processing easier. Usually, the computer rejects or approves the file while the underwriter is responsible for doing manual checks to identify the problem.

Closing Stage- after all processing and verifications have been made by all departments, the mortgage company will contact you to fix a date of meeting. This is when they will brief you again on all the details regarding the loan approval and possible start date of the loan. However, before the loan is approved, you will need to meet with the seller of the property and discus with him. If both parties have reached an agreement and the lender is certified with his verifications, the loan processing will come to a conclusion and the loan will be awarded to you.    
So if you are considering taking up a mortgage loan, the above can help you get acquainted with the necessary steps to take in order to acquire the home of your dreams.


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