Your credit - obtained by your social security number

Your collateral - information on the value of your home

Your capability to pay - your work income and history, and assets

Step two is for us to agree on which program is right for you. At that point we will overnight a mortgage application to your home.  We are required by law to have paper disclosures signed.  We will also collect certain documents - described here.  We will have clear instructions for you on completing the physical application, and can even assist with the completion over the phone.

We supply a return overnight package for you to use to send the package back to us.  When we receive it - we then confirm the receipt, and discuss which rates are available that day to lock.  If you want to "float" the rate for awhile, you can.  If you want to lock that day, we can also.

Then our processing work begins.  And you probably are probably wondering what’s taking so long to get the answer from the mortgage lender. You’re probably convinced that something must be wrong and that your application is being declined. What’s going on?!    
  
Once you’ve completed the application and provided the documentation, the real mortgage process begins. This process can last anywhere from 15 days to 45 days. There are many things that have to happen behind the scenes. 

VERIFICATION OF INCOME AND ASSETS
   
The loan processor has to make sure that all of the required documents verify what is stated on the application. We may mail out verification forms for employers and financial institutions to complete and mail back with current information. This can slow down the process a great deal since you’re waiting on a third party.

CREDIT VERIFICATION
 
A tri-merged credit report (a credit report from all three credit reporting bureaus) is ordered and formatted to delete all duplicates, errors, etc. This can take a few days to get if there are some major creditors not reporting. Once it is received, derogatory information must be addressed and cleared up if possible.

HOME APPRAISAL
  
An appraisal is ordered from a local appraiser. Appraisals take between 5 and 10 days to get. We have seen them take up to a month when the property was located in a rural area.

TITLE REPORT
 
A preliminary title report is ordered, which means that a title search is underway. Normally this takes about 3 to 5 days. It can take longer however, if there are any judgments or liens on public record against the property.

UNDERWRITING
  
Once all of the documents are gathered and the processor has all of your information verified, she submits the whole package to the underwriter to review.

APPROVAL
 
The underwriter has to review every document to make sure that all of the numbers are correct and to determine if your mortgage request meets the lender’s lending criteria or guidelines.  Most loans are written to Fannie Mae and Freddie Mac guidelines, which allows them to be sold.  That they can be sold, allow the lender to provide a lower rate.  

If the underwriter needs additional information to approve you, this is when you will be asked.  This is why the loan officer or processor calls you almost two weeks after you apply, asking for additional information.  But you're almost done!

APPRAISAL REVIEW
 
Once the underwriter has determined that your loan package meets the lender’s criteria, they will review the appraisal and title report to make sure that the collateral is acceptable. The collateral is the house itself.

There are a couple of side items to make you aware of here. First, if for some reason you are not approved by this lender, don’t give up. Each lender and each loan program has different guidelines. Just because you may not meet this lender’s required minimum guidelines does not mean that you wouldn’t fit quite snug into a different lender’s guidelines. Also, it is very common for the underwriter to determine that further documentation is needed to support the application. Don’t worry. Try to remember that the underwriter wants to approve your mortgage request. They will ask for further documentation only if it is required per the loan guidelines or if they believe it strengthens the overall financial “picture” of you. Get her what they need as quickly as possible so that they can issue the final approval for approve the loan.

CLOSING DOCUMENTS
 
The closing department will receive your loan file and prepare all of the final legal documents for your loan closing.

SCHEDULE THE CLOSING
 
You will be contacted to set up an appointment to go sign all of the documents.  You may go to an attorney's office in some states, or to a notary's office in others.  In many cases, a closer may come to your home!  

CLOSING 
 
Go to your loan closing appointment and read every document. Make sure that you understand everything. If you have any questions, make sure that you ask them. (Let’s say it together, ”THERE ARE NO STUPID QUESTIONS!”)

RESCISSION
 
Once all documents are signed and notarized, there is a three day right of rescission on a first mortgage refinance. This is a three business day period of time that is required for your protection. If you were to change your mind about the financial transaction during this time, you could cancel the whole thing.

FUNDING
 
The loan is funded and the Deed of Trust or Mortgage is recorded in the public records of your county.  At this point other debts that you have included in the refinance are paid off.