How to Apply for a Home Loan?

Purchasing a new home is very time-consuming, which is why it is important to have all of your ducks in a row to expedite the process. After finding a home that meets all of your requirements, you will need to apply for a loan and begin the purchasing process. This process may take some time if unprepared, which is why it is important to ensure that you have all the required documentation and information to move the process along. 

Before being able to apply, you will need to select a lender to apply through and complete an application either in person, online, or over the phone. Lenders will need you to provide information about yourself and anyone else that will be listed as a borrower on the mortgage. Once you have found the lender and have started the process, you will need key documentation that showcases all of the financial verification they need to provide you with an interest rate and lending terms. This documentation includes employment history, creditworthiness, and an overall view of your financial situation (such as income, how much you spend a month on rent or living expenses, etc.) You will also need to bring with you five key items: W-2s for the last two years, recent pay stubs covering the last 30 days, bank statements for all financial accounts, signed tax returns, and a copy of the signed purchase and sales agreement. The lender will also need to run your credit report and take a look at your credit score and history. All of this information will allow the lender to prepare the loan and the terms associated with it. 

Considering that interest rates fluctuate frequently, the rate discussed on the day of application and the day you close may differ. If the rate you and the lender discussed at the time of the application was the rate you prefer, then it may be advantageous to lock in the rate at the time of the application. This is completed through a rate commitment, in which the lender assumes that the interest rate and discount points are guaranteed until the rate lock expiration date. By using these tips and having the right documentation, you can easily speed up the application process and get the house you deserve.