GETTING
A MORTGAGE can be confusing and frustrating. Perennial Mortgage works hard to make the
process as smooth and painless as possible. Regardless of what happens, you can count on
us to use our expertise to help you evaluate your options and be there to answer your
questions every step of the way.
If you’ve never had a mortgage, or if it’s been awhile since
your last one, below is a summary of what you can expect from the loan process. While the
information refers to mortgages to finance a new home purchase, most of it also applies to
refinancing an existing residence.
THE APPLICATION – One of our loan officers will get your
information (employment, income, assets, etc) in person or over the phone. Or you
can apply
online on our web site. Your loan officer will provide you with a good-faith-estimate
of closing costs and a federally required truth-in-lending disclosure.
CREDIT REPORTS & DOCUMENTATION – We will need to
collect documentation supporting the information in the application. We will probably need
paperwork such as paystubs, W-2s, bank statements and a credit report. We may also need
other documents depending on your individual situation.
PRE-APPROVAL – After we review the application and other
documentation, we can pre-approve you for a mortgage. We may write a loan commitment
letter to you and your realtor which assumes a certain purchase price, down payment, loan
amount and any contingencies. With the pre-approval you can go shopping for a new house
knowing you qualify for financing.
TITLE AND APPRAISAL – Once you’ve found your home and
have a purchase agreement with the sellers, we will order a title search and commitment
that confirms that the sellers own the property. The commitment (or binder) also will show
any title problems that may need to be addressed prior to closing. We will also order an
appraisal of the property.
HAZARD INSURANCE – You will need to arrange hazard or
homeowners insurance for your new home. The lender will require that you get enough
insurance to cover the loan amount, but you may need additional coverage. If you
don’t know which insurance agent to use or you would like to shop around, let us know
and we will be happy to help you. Once the policy has been arranged, let us know who your
agent is so we can obtain evidence of insurance.
THE UNDERWRITING – All this paper is reviewed by an
underwriter. Occasionally, they will ask us for additional documentation on something
before they clear the loan to close.
LOCKING IN THE INTEREST RATE – Your interest rate can be
locked once you have a property and a closing date. Or we can wait to lock up until a few
days prior to closing. Rates are locked for a set period of time and the loan must close
and fund within that period. Locking the rate guarantees you an interest rate even if
rates go up. If rates go down, unless you buy a float-down option ahead of time, you get
the rate you locked. Interest rates change daily and vary depending on whether you agree
to pay points and/or an origination fee. Your loan officer will talk to you about your
rate options and help you choose the best one for you.
THE CLOSING – We’re near the end! It may have been
only a few weeks since we first met to take your application. Your loan officer
coordinates with the title company and your realtor to schedule the closing. Your closing
documents will be ordered and delivered to the title company. The title company draws up a
settlement statement. Your loan officer will review it to make sure everything is
correct and call you to let you know exactly how much money you will need to bring to
closing. Typically you will need to bring certified funds (not a personal check). At the
closing the title agent will go over all the documents you need to sign. Your loan officer
will usually attend your closing to answer any questions or handle any last minute changes
or problems that might occur.
