For most people, the first thing they think of is going to a real estate agent when they want to buy a house. In fact, the first thing you need to do is to find a loan broker or bank to check your ability of paying back and your financial situation, because then you will know how much you can buy before you go to a real estate agent to shop a house.
Below is the 6 steps to get your home loan done.
1. Fill out loan application form(1003) and prepare your loan documents at the same time you need to get to know your credit Score.
Normally, you can hardly apply a credit card or home loan if your credit score is below 580. The interest rate would be much more higher if your credit score is between 580 to 669. If it’s above 670, you can get a much lower interest rate. A preferential rate would be easy to get if your credit score is above 740.
2. Choose a suitable loan
Mortgage loan officer would offer you a few loan programs. Then, you need to choose a suitable loan according to your financial situation and ability of paying back.
3. Loan Estimate+Loan Disclosure+Lock in rate
After getting the LE(Loan Estimate), you need to sign and return the Loan Disclosure to your broker or bank who will lock the rate straight after.
4. Document Checking+ Home Appraisal
The broker or bank will check every documents. Property appraisers, sent by the broker or bank, would give the correct valuation of the house, which will directly determine how much loan you can eventually get.
5. Loan approval
There are two situations with your approval. You might be approved without condition or approved with conditions which you need to meet those conditions to clean up the loan.
6. CLosing disclosure + Loan Funding
You need to sign some closing documents. These include the Note and the Need of Trusts. Then just wait for the funding and get the key of your house to become a home-owner.
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