Mortgage Lending Library
The The loan process, whether you are applying for a debt consolidation loan, home equity loan, new home loan, bad credit loan, bad credit home improvement loan, second mortgage home, or any other kind of financing, is much the same. There are steps in the loan process that satisfy the interests of both you and the lender: 1) Pre-Qualification. This part of the loan process is the first step after you have gotten in touch with a lender. During this part of the loan process, the lender gathers information about you and your finances to help you find the right loan options. 2) The Application. This part of the loan process involves filling out a loan application and submitting all the documents the lender requires. During this part of the loan process, the lender will give you the Good Faith Estimate (GFE) and a Truth-In-Lending statement (TIL) and will discuss down payments as well as the total cost of the loan. 3) Processing of the loan. About 5 to 20 days after your application, your application information is verified. The processor may want to discuss anything that may become a problem during the loan. 4) Underwriting. The lender gets information from the processor and based on this information decides whether a loan can be granted. If there are problems at this stage of the loan process, the loan may be placed into “suspense” until the issues can be resolved. 5) Pre-Closing. At this stage of the loan process -- which usually occurs 25 to 30 days after the loan application – closing time is determined. This stage of the loan process also involves arranging title insurance and contingencies. 6) Closing. Within 25 to 45 days of application, this stage of the loan process usually takes place. Closing means that the lender sends the money to the seller and gets the property title. Closing is the stage of the loan process where the loan process is at an end and the borrower owns the house. Although most types of loan – including a debt consolidation loan, home equity loan, new home loan, bad credit loan, bad credit home improvement loan, second mortgage home – follow this pattern, the loan process may vary depending on the seller, lender, and your own circumstances. Your lender can let you know exactly what you can expect from the loan process in your case.