After you are under contract, one of the next steps is to formally complete your loan application. If I am your REALTORⓇ, I will send the contract to your lender and they will contact you to complete the loan application.
You will need to complete the loan application by the date listed on your contract. This date is usually within a few days of the property going under contract. Once you have applied for your loan, please let me know so I can keep the listing agent informed.
The documents you sent your lender during the pre-approval process will most likely be outdated. Your lender most likely will request updated documents. These documents could include (but are not limited to) the most recent bank, 401(k), retirement and/or investment statement(s), updated tax return and W2s if we have entered a new tax year, most recent 30 days of paystubs, the most recent benefits letters for Social Security or pensions and any 1099s. If you receive statements monthly, provide your lender with the statements from the two most recent months. If you receive statements quarterly, provide your lender with the most recent quarterly statement.
Getting documents to your lender in a timely manner is very important. Not getting your lender the requested documents in a timely manner is the #1 cause for a delayed closing.
Sometimes, the lender may ask for documents a second (or third) time or you may not understand why a lender needs certain documents. I know it can be frustrating, but resend the documents even if you have already sent them. You can always copy me on any emails to your lender so I have a copy as well. Feel free to ask your lender any questions about the documents that are needed but send those documents as quickly as you can!
What Else Does Your Lender Do?
Your lender will communicate with your chosen closing attorney. They will ask your attorney to start the title search. The lender will also keep your attorney in the loop to the current status of your loan.
Your lender will order the appraisal through a third-party appraisal company. The appraiser will contact me or the listing agent to schedule a date for the appraisal. Once the appraisal is complete, it goes back to the lender and is reviewed for accuracy. Your lender will let you know if the appraised value met, exceeded or came in under the contract value. You will also receive a copy of your appraisal.
If you are purchasing a condo, the lender will also contact the HOA and have a Condo Questionnaire completed.
The lender also confirms that you have homeowners’ insurance in place prior to closing. Should you be purchasing a property during hurricane season (June 1-November 30), it is important to start shopping for your homeowners’ insurance early and bind the insurance policy as soon as possible. Insurance companies may not bind insurance policies when there is a named storm in the area. You cannot close on your property without homeowners’ insurance and this could delay closing.
During the loan approval process, the underwriter assigned to your loan may have questions or need additional information. If this happens, your lender will communicate the questions or information needed to you. Get any information the underwriter needs to them as soon as possible.
As you can see, the loan approval process involves a lot of steps and moving parts and it all starts with getting your loan application started by the date on the contract.
