Offer Accepted! What Happens Next Behind The Scenes
Accepted Offer! Here's What Happens Next Behind The Scenes
Getting your offer accepted is kind of like boarding a plane. You may be sitting in your seat, but a lot still has to happen before you reach your destination.
The First 48 Hours: Kicking Off The Loan Process
Once your offer is accepted, the real estate agent will send your lender the signed contract which will contain any specifics regarding your purchase. This includes the closing date, as well as which title company will be used. Your lender will contact the title company and get an estimate for their fees, and then complete your initial loan disclosure package which will include a Loan Estimate. This form will give you a pretty good idea of the amount of the funds you'll need at closing. An experienced loan officer (like myself) spends a lot of time dialing in these initial figures so you can have an accurate figure early in the process. You'll also be asked to get quotes for homeowners insurance from the companies of your choice.
Another consideration at this time in the process is whether or not to lock in your interest rate. My rule of thumb is if a closing date is within 30 days, I always recommend locking right away. If the closing date is extended, then it may make sense to float the rate until you are closer to the closing date (within 30 days).
Once you e-sign the initial loan disclosures, then your lender will submit your loan into underwriting. Some companies have multiple layers of people working on your loan, so it can be a little confusing. For example, typical retail lenders or banks will have a loan processor assigned who will be handling the processing of the loan, and will be the one coordinating the steps of the loan process to closing. Your loan officer will have limited involvement. That's NOT how I work. Because I have nearly 25 years of experience, I prefer to handle the ENTIRE process myself, so you have only one point of contact, and I can keep you personally updated on each and every step of the process. I find that the loan process not only moves much faster this way, but it also allows you to talk to the person in control.
The underwriting process consists of verification of your income, credit, and assets to ensure they meet the criteria for the selected loan program.
Inspection, Appraisal, and Deadlines
Once your loan is approved in underwriting, the next step will be to wait for you to complete the home inspection period. Typically, I hold off on ordering the appraisal until the inspection period is over or confirmation from the buyer and real estate agent that there are no repair issues that will jeopardize the transaction. I never want my client to pay for an appraisal and then lose that money if the home doesn't meet their criteria after the inspection. The appraisal process typically takes about a week, so once the inspection is cleared, then the appraisal is ordered and the buyer will pay for it. The appraisal will come back with a value that ideally supports the purchase price, and also note if any repairs are required per applicable loan program guidelines. The appraisal is completed by an independent third party, and is not affiliated with the lender in any way.
Important Tips To Keep In Mind
These tips will keep you from major problems during the loan process.
NEVER change or quit your job during the loan process
AVOID any large purchases (yes, even furniture) during the process. And please, don't buy a boat or car. Those purchases can wait!
Do Not deposit large sums of cash without a paper trail.
Make Sure to keep ALL of your debts paid on time. You never want a late payment to show up during the process. (yes, your credit is monitored)
DO make sure to keep all of your documentation organized. (paystubs, W-2s, bank statements)
ALWAYS respond to your lender quickly and honestly.
The Magic Words - "Clear To Close"
After your appraisal comes back, typically your lender will have completed the other items requested by the underwriting during the initial approval. These are typically things like verification of employment, obtaining the title work from the title company, and getting a final insurance policy and invoice from your agent, and addressing any questions the underwriter may have had specifically about your application.
These "conditions" are then resubmitted to the underwriter for final approval. Provided everything that was requested is received, you will then receive the best three words in the whole process, you are now CLEAR TO CLOSE!
Experience Is Everything!
Because there are so many moving parts in the loan process, working with an experienced purchase lender is key. Not only do you want a lender who has a relationship with your real estate agent, but you want someone who has a history of closing loans on time and efficiently. Check reviews online, and avoid working with banks, credit unions, or call centers who only work 9-5 Monday-Friday. The process of purchasing a home often requires availability outside of typical business hours, and it can cause major issues when a lender is not available.
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Peter Seroter NMLS 997692
This blog was written solely by me- not AI.
