There are several important steps that you need to take in order to get a mortgage. Be completely prepared for this process by understanding everything that goes into obtaining a mortgage.

1. Pre-Approval

In order to help you stand apart from the competition when buying a home, it is important to be pre-approved before you make any offers. Pre-approval means that the lender has made a commitment to give you a home loan up to a particular amount. There is a significant amount of paperwork that is required for the pre-approval process. Get the following documents ready to provide the lender: Pay Stubs, Federal Tax Returns, W-2 Forms, Statement of Assets, Residential History, and Proof of Down Payment Funds.

2. Home Appraisal

Your lender will complete a home appraisal before issuing the loan. The home appraisal allows them to determine the value of the home. If the home is appraised at a price that is at or above what you offered the seller than you have passed this part of the process. If the home is appraised for less than your offer, you have an issue because your lender will not give you more money than the house is worth. If this happens, you have a couple of options. You can negotiate with the seller, appeal the appraisal, ask for a second appraisal, or walk away from the deal.

3. Credit Score Maintenance

It is very important that your credit score (regardless of what it is) remains stable while you are under contract for a home. A final credit check will be completed before the loan is issued at closing. Any changes in your score could greatly jeopardize you acquiring your loan. Avoid this by not opening new credit accounts, closing old ones, or missing payments while you are under contract.

4. CD Review

You will receive a Closing Disclosure (CD) from your lender just before you close. The CD outlines the fees you will pay during settlement. CDs can contain errors so it is imperative that buyers examine the document thoroughly before signing. Sit down with your realtor to review the CD with the loan estimate (which you received when you first applied for your loan) to check the following items: Name, Loan Term, Loan Type, Interest Rate, Cash to Close, Loan Amount, Total Monthly Payment, and Estimated Taxes and Insurance.

5. Underwriting

Your mortgage will go through the underwriting process before the loan is finally issued to you. During this process, an underwriter will verify all of your information to ensure that you have been truthful in your application. As long as you have remained stable in your job status, credit score, and debts, you will get through this part of the process with ease.

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