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Steps To Get A Loan
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Here are 8 typical steps to approve and fund a loan
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You |
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Lender |
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You complete and submit lenders online application. |
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Your information is reviewed and sent to the appropriate associates. Depending on the transaction, you might be able to lock your rate at this time. You are then sent an application to sign. |
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You return your signed application and required supporting documents to lender. |
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An appraisal is ordered for most loans now. |
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If you haven't already done so, you can request to lock a rate anytime after your signed documents. |
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Your application and supporting documents are reviewed and everything is assembled into a "loan package," then sent to underwriting for approval. |
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Three possible outcomes of underwriting review: |
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Loan approved Go to Step 6 |
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Loan approved with conditions
You meet the conditions and then loan is resubmitted. |
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Loan denied
Your loan package is sent to another lender and/or discuss other options. |
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The timing of your loan closing is coordinated with you and your settlement agent. |
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You sign your final loan documents on (or before) the closing date. |
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The lender wires your loan amount to your settlement agent. |
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1 day +
This step can take 1 day or longer, depending on you. You'll need to gather the required documents, such as your pay stub, W-2 and bank statements, make copies and then send in the originals with your signed application in the prepaid envelope the lender provides. The sooner you get everything in, the sooner your loan can be processed.
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Step #4
2 - 4 days
During this time, your title insurance is ordered and confirmed that you meet the lender's guidelines for the mortgage you want. If you don't qualify, you might find a similar mortgage that fits your needs elsewhere. The lender will usually request additional supporting documents, such as 401k statements. The quicker you collect and send in these documents, the less time you'll need for closing.
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Step #5
2 days to several weeks
The total time to complete this step depends on the lender, and on you. Normally, the lender takes from 3 to 7 business days to review your package and make a decision on your loan. If your loan is approved with conditions, it may take some time to meet all the lender's requirements.
The lender typically gives you their final decision within 2 to 3 days.
Standard lender conditions include:
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- Clear title (ownership) to the property
A title insurance company will conduct a title search to make sure that the seller actually owns the property that you're about to buy. Also, the seller must pay off any claim or lien placed on the property by a creditor.
- A signed loan application (1003) reflecting the final terms of the loan
- An appraisal that supports your property's value
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