Buying a condo or apartment in Florida is a significant investment. It can impact your finances as well as your entire life. With so much involved in the loan application and the complexities on the way, the process can get challenging, especially for the first-time buyers.
Mortgages are quite like loans. There is some amount of money borrowed, a rate of interest to be paid, and a time fixed to repay it. However, the only line of difference is that mortgages are specifically used for the real estate transactions and are customizable.
So, hire a local experienced mortgage broker who can take you through the following mentioned mortgage lending process smoothly and make your home buying ride hassle-free and exciting.
Step 1: Take Mortgage Pre-Approval
With a mortgage pre-approval in hand, it is easy to tell the sellers that you are not fooling around and are serious about making the purchase. So, fill out an official application and provide your bank/lender the desired financial documents and a credit report to get it.
Step 2: Submit Loan Application
You can officially start your house hunting journey when you are pre-approved for the loan. Once you find your dream home, you can submit the application along with some documents to the bank and wait till it gets processed.
Step 3: Get Loan Estimate
Within three days or so of your loan application, you receive a loan estimate that describes the terms and the costs associated with it. It also includes the interest rate and monthly payments such as principal, interest, taxes and insurance.
Step 4: Wait for Mortgage Processing
In this phase, all the information related to your finances and loan application and documents is opened. Also, your tax records, employment letters, bank statements, the purchase agreement, and home appraisal report are requested for further evaluation.
Step 5: Receive Underwriter’s Decision
A mortgage underwriter is the final decision maker who passes or rejects your residential mortgage application after taking a careful look at the documentation. He/she is ultimately the person who sees if everything is in compliance with the standards and fits the guidelines.
Step 6: Lock in Loan Interest Rate and Terms
Your underwriter also locks in your interest rate and loan terms. The maximum loan repayment duration is fixed and whether the interest rate is adjustable or fixed is decided. Doing this is crucial because without locking in an interest rate, there can be risk of interest rates rising later.
Step 7: Obtain Loan Approval
When the underwriter is sure that there is no problem, he/she lets the process to keep moving forward and finally grant you the approval. Your loan is signed off and your loan is cleared to close, allowing the purchase of home you desire.
Step 8: Close the Deal
This is the final step of loan process. Documents are printed out, sent to the title company and then a meeting is arranged to finalize the transaction. A “closing disclosure” is settled on that has details such as the projected monthly payments, loan terms, fees, closing costs, etc.