What To Expect During The New York Mortgage Process
An Overview of The Initial Document Review, Underwriting, Property Appraisal and Clear to Close Stages
The mortgage process can seem daunting and a bit overwhelming, especially if you’re a first time homebuyer. When shopping your home financing options for the very first time, it can be tough to know where to start – and to know what to expect as you move forward with obtaining a mortgage.
At Maple Tree Funding, we work hard to make the home buying process easy and accessible for everyone, but especially for first time homebuyers.
We know first hand that understanding what to expect at each phase of the mortgage process can make purchasing a home and securing a mortgage seem much more manageable.
Here, we’ll delve into the details of what to expect during four of the key stages of the mortgage process.
Starting the Mortgage Process: The Initial Document Review
The first step in the mortgage process for all home buyers is typically the initial document review. During this phase, the mortgage lender or mortgage broker you are working with will perform a preliminary examination of your income, assets, credit score, and more.
Check out this short video for a quick overview of the initial document review process.
What Documents Will I Need To Provide For An Initial Mortgage Document Review?
To perform this initial document review, you’ll be required to provide a number of important documents, including:
- Paystubs
- W2s
- Bank statements
- Tax returns
As you approach the mortgage process, it’s a good idea to assemble these documents ahead of time so you have them on hand when you need them. Check out this list of items you’ll need to apply for a mortgage to find out which documents you should be gathering!
What NOT To Do During and After The Initial Mortgage Document Review
To ensure things continue to go smoothly with your mortgage process after you’ve initiated the initial document review, there are a few important things you should be sure to avoid doing.
- Do not quit your job
- Do not change jobs
- Do not make any major life changes
- Do not apply for any new credit cards
- Do not make any large purchases
These changes can have significant impacts on your credit and may change or impact your ability to qualify for a mortgage. Once you’ve started the mortgage process, it’s important to avoid major changes like this as much as possible.
Moving on to The Next Steps of the Mortgage Process
After the initial review, we’ll contact you with information about your interest rate and let you know which home loan options you qualify for.
The initial document review is a very early phase of the mortgage process, and there are a number of important steps that follow it.
If all goes smoothly during this first step, you’ll move on to the next stage: starting the underwriting process.
On to The Next Step: Underwriting
Before a loan can be approved, it must go through a phase called underwriting. This phase happens after the initial mortgage document review, but before you receive a property appraisal and are cleared to close on your new home. (The property appraisal typically happens while your file is in the underwriting process.)
This short one-minute video will give you a quick overview of what to expect when it comes to the mortgage underwriting process.
What is Mortgage Underwriting?
Mortgage underwriting is the process that lenders in the United States use to determine whether or not to move forward with issuing a home loan to a borrower. It’s a close analysis and review of the parameters of the loan and the qualifications of the home buyer.
What Do Underwriters Do?
Underwriters compile and review your documents, ensuring that they are accurate and that your loan meets all qualifications and guidelines.
What Does It Mean If My Loan Is In Underwriting?
If your home loan is in underwriting, it means that it is in the midst of the process that will ultimately determine whether or not your mortgage will be approved. An underwriter is actively reviewing your file to decide whether your loan will be approved or denied.
How To Prepare for The Mortgage Underwriting Process
You don’t need to do much to prepare for the underwriting phase of the mortgage process. Just keep in mind that the underwriter may reach out to you for additional information and documentation to prepare your loan for closing. Be prepared to respond to these requests quickly if you want to keep the mortgage process moving forward smoothly!
Continuing the Mortgage Process: The Property Appraisal
Next up, it’s time to gather some information about the home you’re planning to purchase. The property appraisal typically happens while underwriting is taking place, as the underwriter will need to review the property appraisal before providing the clear to close.
What Happens During a Property Appraisal?
During the property appraisal, a licensed real estate appraiser will visit the home to assess it and determine its value. This will give you and the underwriter, who will finish reviewing your file once the appraisal is complete, an accurate understanding of the value of the home.
Watch this short, one-minute video for a quick overview of what to expect during a property appraisal.
What is Inspected During a Property Appraisal?
The real estate appraiser will look at a number of factors during your home appraisal, including:
- The overall condition of the home, including exterior features like siding, roof, and foundation, and interior features like attics, crawl spaces, and stairways
- The neighborhood where the house is located
- How much similar houses in the area sold for in the last 6 months
They will also calculate the home’s replacement cost.
How To Prepare for a Home Appraisal
To keep the mortgage process moving forward, it’s important to be well prepared for the home appraisal phase. While much of the preparation, including handling repairs, is the seller’s responsibility, there are ways that the buyer can help things to go smoothly.
Providing any necessary information to the appraiser, such as the location of the septic field or where the access point for the crawl space can be found, following up on items, and tracking down any details that the appraiser requests can be hugely helpful and can help a home appraisal go smoothly.
Check out our blog post about home appraisals for more tips to help the property appraisal go smoothly.
Wrapping Up The Home Appraisal Process
After the property appraisal is completed, you’ll receive a detailed copy of the report for your records, and the underwriter will have the information necessary to complete the underwriting process and move forward with the next step of securing your mortgage: Providing the clear to close.
Completing the Mortgage Process: Clear To Close
If everything goes smoothly and your mortgage is approved during underwriting, you’re another step closer to closing on your new home.
The clear to close step is the next, and final, stage of the process before you can finally call your house your own.
What Does “Clear to Close” Mean?
When you receive the clear to close on your mortgage, it means that you have met all the conditions established by the lender, and that the lender has reviewed all of the conditions and has officially agreed to finance your home loan.
In other words, clear to close means that you have the okay to move forward with purchasing your home.
What Happens During the Clear to Close Stage?
This short video provides a quick overview of what happens when you reach the clear to close phase of the mortgage process.
I’ve Been Cleared to Close. What Comes Next?
Once the clear to close has been issued, you’ll establish your closing date – the day home ownership will transfer from the seller over to you! On that date, you’ll meet at the designated time and location with the seller and your attorneys to sign the documents finalizing the sale of the home and complete the transfer of the deed/title.
And just like that – you’re a homeowner!
Need Help Navigating the Home Mortgage Process? We’re Here For You!
Have questions about any step of the mortgage process? Feel free to reach out to us at 518-782-1202 or contact us online and we would be happy to walk you through what to expect!
Shopping for a home in New York State? Maple Tree Funding is a trusted local mortgage broker serving all of New York! We offer low rates, competitive loan programs, and a high level of customer service to all of our clients.
Whether you’re buying your very first home, or you’ve navigated the home mortgage process before, we can guide you every step of the and help you find the mortgage that’s right for your unique situation. You can learn more about us here.
Looking for more information about the mortgage process? Here are some additional resources to get you started:
Understanding the Mortgage Process – Find more details about the steps you’ll move through to obtain a home loan, including the steps that take place before the initial document review.
Who is Involved in Buying a Home? – Learn about the ‘who’s who’ of home buying and familiarize yourself with the people you’ll be working with as you move through the process of buying a home.
Common First Time Homebuyer Mistakes to Avoid – Understand some of the key mistakes that many first time home buyers make, and get tips for how to avoid them as you’re working towards buying your own home.