Page 92 - HBG 2019-watermarked

Whichever type of lender you choose to patronize, allow a minimum of 30
days for the loan approval process. Delays are not uncommon, so it’s best to
allow even more time if possible.

Often, the differences between the types of lenders will make little or no
difference to the buyer; the most important trait to look for is integrity. An
honest, knowledgeable professional will be able to advise you based on your
circumstances and will direct you towards the best product for your needs.

Mortgage Approval Process

The underwriting process: Upon applying for a mortgage, you will submit all
your necessary supporting documents to your loan representative, who will
then submit them, along with the mortgage application, to an underwriter.
The underwriter, a representative of the lender, will review the application and
render a decision whether to approve the loan, deny it, or request additional
supporting documentation or explanation of discrepancies.
Home appraisal: While considering the loan application, the lender will order
a home appraisal to assess the value of the home. If the home is appraised
as less valuable than the mortgage being requested, the application may be
denied. The cost of the appraisal, usually around $400, will be due at closing.

Locking in your rate: Once you have been approved for a loan, you will need
to lock in your interest rate. Locking in a rate means that even if interest
rates increase before you close, you will still receive the loan at the original
rate. The shorter you lock your rate, the better rate you will get. There may
also be a charge for long locks. Sit down with your mortgage representative
and discuss the probability of closing within the specified time-frame and
the various risks or benefits of locking in a rate for a given amount of time.
With new construction, in particular, it can be difficult to determine when the
closing will actually occur.

92 | 2020 Lakewood Home Buyer’s Guide