Episode 8: Mortgage Underwriting & Appraisal
In this eighth episode of the Home Buyers Guide, Matt walks you through the mortgage and lending aspect of the home buying process, with some help from Mark Moore of Supreme Lending.
There are two tracks of a home buying process that mostly run parallel to one another, but sometimes connect: the real estate purchase side and the financing side. While we’ve normally focused on the real estate side, in this episode our attention changes over to that other track, financing. In order to give you the best understanding possible, we asked our friend Mark Moore of Supreme Lending to help us out.
Using a lender to purchase a home inevitably comes along with a good amount of homework. It is your job as the buyer to make sure that the lender has all the information they need in order to be able to approve your loan.
Some common documents your lender will ask for are: 2 years of W2’s, 2 years of tax returns, pay stubs, and 2 months of bank statements. It is important to make sure your lender has these as soon as possible, because the more they have upfront, the less likely it is for problems to occur near closing The job of an underwriter in the loan process is basically to just make sure that all the required documentation has been turned in, so aim to make their job easy.
When you go under contract, or ideally earlier, your lender will send you that list of required documents and a set of disclosures. Make sure to turn that documentation in and get those disclosures signed. Your lender will not be able to move forward with your loan until you have that done. Aim to have it all in within 24 hours! Once you do your rate will be locked in and you should be all set for a smooth approval process.
The appraisal can only take place after these documents are signed and turned in, so that is just one more reason to have that step done promptly. Once the lender has what they need, they will order the appraisal, coordinate with the seller, and make sure you receive the appraisal afterwards.
The last thing to remember is not to make any major financial changes during this process. Taking out another loan, quitting your job, opening another line of credit, etc. will complicate your transaction. Be cautious and communicate with your agent and your lender if you have any questions.
