Home Mortgage Process

This ARTICLE On The Home Mortgage Process Was Written By Gustan Cho NMLS 873293 of CrossCountry Mortgage Inc. NMLS 3029

Once you have turned in the signed mortgage application and signed disclosures along with the requested documents such as W2s, bank statements, tax returns, and other necessary mortgage documents to your mortgage loan originator, your mortgage application package Home Mortgage Process and is now ready for the will be processed by the mortgage processor.

  • The mortgage processor’s role and job is to make sure all mortgage documents are complete and there are no missing items and prepare them for a mortgage underwriter to review the whole file.
  • Upon reviewing for completeness, the processor will submit the loan file to the underwriting department and a mortgage underwriter will be assigned.
  • Once the underwriter underwrites the loan application, the underwriter will issue a conditional mortgage loan approval if the borrower meets all necessary lending guidelines and requirements for the particular loan program. 
  • The mortgage underwriter carefully goes over the borrower’s credit report, credit scores, assets, income, bank statements, tax returns, bankruptcy and/or foreclosure files if any, and other determinants.  
  • The underwriter is the person that issues a loan determination of whether it will approve, deny, or suspend the file after the underwriter has verified income, assets, liability, and credit.

Conditional Mortgage Approval In The Home Mortgage Process

Very rarely will a mortgage be approved without conditions but it does happen.

  • Initial mortgage approvals are conditional approvals. 
  • A conditional approval is that the mortgage loan has been approved by the mortgage underwriter as long as further documentation that the mortgage underwriter needs to totally finalize your mortgage loan application prior to a clear to close. 
  • A clear to close mean the same as ready to fund the mortgage loan. 
  • Once you get a clear to close in the home mortgage process, it means that your mortgage lender is ready to disperse the loan and you are ready to close.

Stages In The Home Mortgage Process

The mortgage loan approval process goes through several stages of reviews in the Home Mortgage Process and many mortgage loan borrowers often are aggravated why the conditions on the conditional approval was not asked or requested earlier in the mortgage approval process.

  • Some of the mortgage conditions may seem super silly and not pertinent but you need to provide the information requested.
  • Wholesale mortgage lenders and mortgage bankers using their own warehouse lines of credit need to be super anal in compliance and following Fannie Mae and HUD guidelines because they need to resell the mortgages they originate. 
  • One mistake means that the mortgage loan cannot be sold to the secondary market and they will be stuck holding the mortgage loan in their portfolio.

Clearing Mortgage Conditions During Home Mortgage Process

Once you have met all the conditions of the mortgage loan underwriter, the mortgage underwriter will sign off on it.

  • Depending on your mortgage lender,  some mortgage lenders have their own QC, Quality Control Department, which will go over the signed off mortgage approval and they will issue the clear to close. 
  • QC normally goes over the whole package from A through Z and make sure that the mortgage underwriter has not made any mistakes and makes sure the whole mortgage file is in compliance. 
  • This process normally takes 24 to 48 hours.

Definite NO NO’s During Mortgage Approval Process

From the time you submit your mortgage approval process, there are definite things you must not do or you mortgage approval process will come to an end and you will be issued a mortgage loan denial.

  • Do not apply for new credit. 
  • Each hard credit inquiry wll drop your credit scores by at least 5 points.
  • Do not charge new purchases on your credit cards. 
  • The mortgage lender WILL do a soft credit pull prior to a clear to close and new charges can affect your debt to income ratios.
  • Do not purchase any new items such as cars or new furniture.
  • Do not have any bank overdrafts. 
  • Even a $5 dollar overdrafts can be a cause of a mortgage loan denial.  Lenders do not accept anyone who had a bank overdraft in the past 12 months.
  • Do not change your job or quit your job.
  • Do not close out any bank accounts or do any bank transfers and make sure that you have your down payment in one of your bank accounts or do larger than $200 withdrawals or deposits without sourcing it.
  • Never be late on any credit monthly payment.
  • Do not dispute any derogatory credit or hire a credit repair company. 
  • Disputing derogatory credit with a credit balance will disqualify you from the mortgage approval process. 
  • Do not pay any old collection accounts either because paying your old collection account will plummet your credit scores by 80 POINTS or more. 
  • I can get you a mortgage loan approval with open collections and charge off accounts.
  • The Gustan Cho Team at CrossCountry Mortgage Inc. NMLS 3029 is a national Fannie, Freddie, Ginnie Mae Direct Lender with no lender overlays on government and conventional loans with a policy of closing loans in 21 days or less.

Locking Your Mortgage Rate

You mortgage rates needs to be locked sometime during the mortgage approval process and prior to a clear to close.  Most lock periods are 15 days to 30 days.  The shorter the lock period, the less you will be charged in mortgage adjustment costs and less costly it will be.  Unless you are on a borderline debt to income ratio, I recommend to lock your rates on a 15 day lock unless the rates are volatile.

If you need a mortgage approval with a five star national lender with no mortgage lender overlays, please contact Gustan Cho NMLS 873293 of The Gustan Cho Team at CrossCountry Mortgage Inc. NMLS 3029 at 262-878-1965 or text Gustan Cho on his cell at 262-716-8151 . Visit Gustan Cho Associates Mortgage and Real Estate Information Resource Center at www.gustancho.com for the latest news and new mortgage guidelines.  I offer mortgage loan programs to mortgage loan borrowers in the United States with no mortgage lender overlays and can do one day underwrites.  Two week closings from the time we submit your mortgage loan application to underwriting.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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