The concept of a mortgage is quite simple. It's basically a loan for a home wherein the property itself is used as collateral.
Securing a mortgage, however, can be complex. The process may take more than a month, as several parties – from the escrow officer to the loan underwriter – work behind the scenes to put it all together.
A trusted real estate agent can recommend a reputable mortgage professional and help you navigate through the process.
Finding the Right Mortage Professional
A EXIT REAL 360 agent can help you find a solid lender or broker. You might also ask friends, family members and colleagues for references.
When interviewing lenders and mortgage brokers, consider asking the following questions:
• What types of mortgages might I qualify for?
• What interest rates are available for different types of mortgages?
• Can I lock in an interest rate? Will it cost me anything to do that?
• What are the closing costs? Can I wrap these costs into the mortgage?
• How much cash will I have to bring to closing?
• How long will it take to process my loan?
• Are there special programs I might be eligible for?
• Can I get references of customers you've worked with in the last two years?
• How many lenders do you work with? (For mortgage brokers only.)
• How are you paid? How do you make money on my loan? (For mortgage brokers only.)
Getting preapproved is simply a matter of your lender checking your financial situation and writing a letter stating that it would be willing to lend you a certain amount of money.
You'll need to assemble several documents to start the preapproval process:
Don't open new credit card accounts or take on any new debt for at least six months (and even up to a year) before shopping for a mortgage
• Federal tax returns for the last two years.
• W2s (or 1099 statements) for the last two years.
• Bank statements for the last two months.
• Recent pay stubs and proof of any other income.
• Proof of assets (stocks, mutual funds).
• Information about your current debts.
• Information about the source of your down payment, including gifts.