top of page
8 Steps of the Home Loan Process
A breakdown of what you can expect when applying for a mortgage.
Step 1
Let's Talk & Find the Right Home Loan for You
To start, we’ll discuss your mortgage needs.
If you're buying a house, refinancing, or taking cash out, we’ll figure out what home loan best for you.
Since every mortgage is different, we’ll look at key factors like your credit score, how much you're borrowing compared to the home's value, and the type of loan you need.
We'll also go over any debts, properties you own, and credit concerns that might affect your loan options.
To get started, I’ll pull a mortgage credit report (which is different from the scores you see online).
This helps us determine potential interest rates and which mortgage loan programs you qualify for.
With so many options out there—each with different rates, points, and fees—choosing the right home loan can feel overwhelming.
But don’t worry. As an experienced mortgage loan officer, I’ll help you sort through the choices, explain your options in clear language, and recommend the best fit for your situation.
Step 2
Choosing the Right Mortgage Loan Program
Now it’s time to choose the home loan that fits you best.
I’ll walk you through various types of mortgages so you can make the best decision for your budget and future.
We’ll review mortgage loan terms.
Do you want a 30-year fixed rate mortgage loan with lower monthly payments?
Or maybe a 15-year loan to pay off your home faster and save on interest?
We also have 10, 20, and 25-year options, plus adjustable-rate mortgage loans (ARMs) that start with a lower rate for the first few years.
Next, we’ll discuss loan types.
Conventional home loans work well for many buyers, while high-balance loans help in areas where home prices are higher.
If you're buying a luxury home, a jumbo mortgage loan might be the right choice.
Finally, we’ll go over rates and closing costs.
You can choose to pay points to get a lower rate, cover some or all your closing costs upfront, or go with a no-points, no-closing-cost loan to keep your upfront expenses low.
I’ll break it all down and help you find the best setup for your financial goals.
Step 3
Gathering Documents & Submitting Home Loan Application
Now that we’ve chosen the right mortgage loan program, it’s time to gather the paperwork needed for your mortgage application.
I’ll guide you through exactly what’s needed, and you can always reach out if you have questions.
To get started, I’ll need documents that give a clear picture of your finances.
These may include your:
· W-2s from 2024 and 2023 & Fed Tax returns (Business if applicable)
· 1 month of most recent pay stubs
· Tax returns (especially if you own a business).
· 2 months latest bank statements (all pages)
· Up to date retirement or investment account details (all pages)
· Most recent 1st mortgage statements if you already own a home. (2nd home equity if applicable)
· Home insurance and property taxes information
Once you’ve gathered these, upload them using this secure link.
After I receive everything, I’ll complete your formal application and send it over for your signature—so be sure to review and return it quickly.
If an appraisal is needed, I’ll schedule that right away to keep things moving.
Step 4
Processing Your Mortgage Application
Once your mortgage application is submitted, things start moving behind the scenes.
This is where our loan processor steps in to review all the details and make sure everything checks out.
Think of them as the quality control expert, making sure your loan package is solid before it goes to the lender.
First, they’ll go through your credit report, bank deposits, and payment history to verify everything matches up.
If there are any past-due payments, collections, or judgments, they may ask for a written explanation—nothing to stress about.
Next, they’ll review the home appraisal and title report to confirm there are no property issues that could cause delays.
If anything needs further investigation, I’ll let you know right away.
Once all the pieces are in place, your mortgage package is submitted to the lender for final approval.
Step 5
Understanding Your Credit Report & Its Role in Your Home Loan
Your credit report plays an important role in the mortgage process—most people don’t run into major issues.
Still, it’s always a good idea to check your credit report before applying for a mortgage.
That way, if there are any errors or negatives, you’ll have time to fix them before they affect your mortgage application.
Your credit profile is basically a snapshot of your financial history.
It shows how you’ve handled past loans, credit cards, and other debts.
The five main parts to a credit report are:
· identifying information
· employment history
· credit accounts
· public records (like bankruptcies or judgments)
· and recent inquiries from lenders.
If you’ve had any late payments or financial setbacks, I’ll help you write a Letter of Explanation if needed.
Lenders understand that things like job loss, medical bills, or other hardships can affect credit.
If you’ve been making on-time payments for at least a year, you should be in good shape.
Your FICO score is the number lenders use to measure your credit-worthiness.
This score was developed by Fair, Isaac & Company, Inc. for the three main credit Bureaus;
· Equifax (Beacon)
· Experian (formerly TRW)
· Empirica (TransUnion).
It’s based on things like payment history, debt levels, and credit usage.
A few simple habits can help boost your score:
· paying bills on time
· keeping credit card balances low
· closing accounts you don’t need
· making sure your credit report is accurate
Don’t open any new credit accounts while you’re going through the mortgage process.
The lender will check your credit again a few days before closing, and any changes could delay or even jeopardize your home loan.
Step 6
The Real Estate Appraisal – Determining Your Home’s Value
The real estate appraisal is a key part of the mortgage process.
It ensures that the home you’re buying (or refinancing) is worth the amount of money being loaned.
The appraiser’s job isn’t to create value but to analyze the market and determine a fair estimate based on similar homes and other key factors.
During an appraisal, the appraiser looks at the home’s size, condition, location, and special features like upgrades or amenities.
They also research local market trends and recent sales to come up with an estimated value.
The final report gives the lender confidence that the home is worth the price—and that the home loan amount is appropriate.
Appraisers use three main methods to determine a home’s value:
1. The Cost Approach – This method calculates how much it would cost to rebuild the home from scratch, factoring in wear and tear or outdated features.
2. The Comparison Approach – This is the most common method for single-family homes. It looks at recent sales of similar properties (called “comps”) in the same area to estimate market value.
3. The Income Approach – Mainly used for rental properties, this approach is based on how much income a property can generate for an investor.
Hopefully the appraisal comes in at or above the purchase price.
If it’s lower, we may need to re-evaluate the home loan amount, negotiate with the seller, or challenge the appraisal if there’s a discrepancy.
Either way, I’ll guide you through the process and make sure you understand all your options.
Step 7
Underwriting – The Final Review
Once all your documents have been gathered and reviewed, your loan file is sent to the underwriter.
This is the person who gives the final thumbs-up (or asks for more details) before your mortgage can move forward.
Think of the underwriter as the last checkpoint, making sure everything meets the lender’s guidelines.
The underwriter reviews your credit, income, assets, and the property appraisal to confirm that everything lines up.
If they need more details—like extra pay stubs, bank statements, or explanations about certain transactions—they’ll put the loan into “suspense” and we’ll work together to provide the needed info.
Once everything checks out, your loan will move to “approved” status.
Step 8
Closing on Your Mortgage – The Final Step
Once your home loan is officially approved, it moves to the closing and funding department, where all the final details come together.
The closing attorney will schedule a closing date and time for you to sign your loan documents.
I’ll make sure everything is set for a smooth closing day.
Here’s what you need to do at your closing appointment:
• Bring a cashier’s check (if required) for your down payment and closing costs. Personal checks usually aren’t accepted and could delay the process.
• Bring your ID and proof of homeowner’s insurance.
• Review all your final loan documents carefully—double-check that your loan terms, interest rate, name, and home address are all correct.
• Sign all your paperwork and make it official.
Once everything is signed, the closing attorney sends the documents back to the lender for a final review.
If everything looks good, the home loan is funded, and the mortgage is recorded with the county.
If you’re doing a cash-out refinance, final disbursements happen after a three-day waiting period.
Once the mortgage loan is recorded and the final settlement paperwork is complete, you’re officially a homeowner (or your refinance is finalized).
Congrats on reaching the finish line!
In Summary
A typical mortgage process takes about 14 to 21 business days to finish.
Thanks to automated underwriting, things move much faster now, helping you get to closing quicker.
Thank you for your business.
Please give me a call or email if you have any questions about this process!
I am available 24 hrs, 7 days a week for any questions about the Mortgage Process or to get started on your Mortgage. Call me at 508-451-5840 or email me at hbrousaides@northstarmortgage.com
bottom of page