Understanding the Home Loan Process

Be Patient and Confident During the Home Loan Process

This guest post, an overview of the home loan process, is brought to you by Stanley Erker, Wells Fargo Home Mortgage Consultant.

Here's what Stanley has to say:

The home loan process is a series of milestones beginning with the initial consultation and ending with the closing of escrow. For buyers preparing to purchase a home it’s important to be proactive in receiving a mortgage pre-approval prior to submitting an offer. Getting pre-approved is particularly important in seller's markets like we're experiencing in San Francisco now.

Phase I: Consulting With a Mortgage Professional

Begin by consulting with a mortgage professional to find out what mortgage options are available based on your current credit and financial profile.

You'll also want to:

• Discuss short and long term homeownership goals. Is there potential to upsize, renovate, or relocate in the near future?
• Share accurate details around employment/earnings history. Is there a likelihood earnings will continue at the same level or more? Is there a pending acquisition or promotion which will result in higher earnings?
• Determine your current credit profile and whether you have a history demonstrating a willingness to repay financial obligations with various creditors?

Phase II: Get Pre-Approved for a Home Loan

Continue the process by completing a mortgage application and applying for pre-approval.

• Provide an organized and complete set of supporting financial documents as requested by the mortgage consultant (W2’s, 1040’s, pay stubs, and asset statements).
• Sign and date a consent for credit reporting. Find out your current credit rating and discuss opportunities to maintain or improve credit scores.
• Explore financing scenarios based on different price ranges, down payments, and product options.
• Carefully review initial disclosures around the terms and conditions. Ask about anything that isn’t fully understood.

Be as transparent as possible and provide all requested information as promptly as possible. Your home loan consultant is on your side and wants you to be successful in getting pre-approved and buying the perfect home for you.

Phase III: Manage Your Emotions

Getting pre-approved for a home loan can be emotionally tricky as well as time-consuming. Remain patient and confident while application is being reviewed.

The overall goal is to pre-approve a mortgage application so a buyer can feel financially confident, submit a competitive offer, and demonstrate credit-worthiness to potential sellers/listing agents.

More Information

Thanks, Stan! The SFhotlist Collective appreciates your insight and expertise! Over the years, we've written frequently about how crucial it is to be pre-approved for financing at the beginning of your house hunt. The dates may change but most of the information stays the same. For your further review...

Buying a Home in San Francisco? It's crucial to be pre-approved! 

How to Choose a Mortgage Broker

Work with a Local San Francisco Lender

{Photo Credit: World Bank}