Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0

For a first time home buyer, financing can be a big challenge. However, if you are well prepared, you can expedite the process and own your home in a short period of time. The following article takes you through the financing process for your new home.

Preparation

Before you start searching for a mortgage, familiarize yourself with the types of loans available. You can get information about loans from real estate magazines or from online mortgage sites. After you have understood the different terminology and rates, prepare a budget based on what you can afford to pay on a monthly basis.

Considerations

The most crucial step in the home loan process is identifying the right loan officer and lender. Companies like SettlementOne can provide guidance in choosing a lender who suits your budget. The job of the loan officer is to take you through the entire loan process. Conduct interviews with several loan officers until you find one who suits you.

Documentation

Before you make appointment with your loan officer and lender, you need to have your paper work in order. The main requirements are your social security number, W-2 forms, pay slip or tax returns, bank statements for the past 3 months, driver's license, loan statements and court ordered payments like child support or alimony.

Pre-Qualification

Your loan officer will review your documents to decide the loan you are qualified for. A truth in lending statement and good faith estimate will be generated to show you the terms and closing costs of the loan. These are the documents that will help you compare different loan offers and choose the one that suits you.

Approval

After choosing a lender, your application will be submitted for processing. A loan processor reviews your application, compiles a file and orders an appraisal. The loan processor might require you to provide additional information. After the appraisal, your file will be handed over to an underwriter who after reviewing your file, will decide whether the loan should be approved. After the loan has been approved, you are required to sign the loan documents to complete the transfer of property. The transfer of property could take up to 30 days.

 

Owing a home can be scary at first but when you understand the process of financing, there is clearly nothing to be worried about. The following are some of the phases you need to go through when securing a home loan.

Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.