The Loan Process

Once you have a house "under contract" - you and the seller have agreed to the terms of the sale, it takes about 4-6 weeks to go through the loan process which has several elements:

PROCESSING

Processing is a general term for the period during which the lender is checking on your checking on your employment status, evaluting the documentation you provide, validating your credit status, and bank balances, and ensuring you have the proper documents to accept ownership and responsibility of the home.  During this time, several things will happen:

APPRAISAL

An appraisal will be conducted to determine/confirm the house’s value, and take care of all the paperwork for your loan.  If the appraised amount is less than your purchase price, you can cancel the contract and receive your deposit back or re-negotiate the price. You will need to pay for this appraisal, (unless the seller agreed to pay for it) and this will cost about $350-$450. 

TITLE SEARCH

A title search will be requested to ensure that the current owner of the house you are buying does not have any liens against it, or other issues, to ensure that when you close you will have clear title tand rights to the property.

INSPECTION

While it is not required, your Realtor should (and Benchmark Loan Office will)  strongly advise you to  get a home inspection from a licensed inspector.  This service will cost you from $200-$300, but it is money well spent.  The inspector will ensure the structural viability of your home, and point out things that need to be repaired, replaced or are worn out.  These are things you should know about BEFORE you take ownership of a home.  We also recommend that you be there  with the inspector - they will be able to show you where some of the important mechanical functions of your new home are, like location of electricity breakers, water shutoff valves, etc. 

INTEREST RATE "LOCK"

Your lender will need you to sign several documents that “lock in” your interest rate and confirm all the specifics of your loan.  You will need to collect and share with your Loan Officer proof of your income and assets.  Your Loan Officer will give you a checklist of things, like pay stubs, tax returns, bank statements, and anything else they need to prove that you are qualified. 

HOMEOWNERS INSURANCE

You also will need to secure homeowners insurance to protect your home in the event of fire or natural disaster.  It is common to get your  homeowner’s insurance from the insurance company you use for car insurance because you tend to get a better deal (called a multiple policy discount).