The Mortgage Process: An overview of what to expect from application to closing

Today’s article was written with help from Toll Brothers’
subsidiary company, TBI Mortgage.


Getting Started
Even if you’re not a first-time home buyer, the home financing process might seem a little intimidating. Let’s break it down step-by-step so you know what to expect from the time you complete your mortgage application to the day you settle.

Once you begin house hunting, it’s a good idea to get pre-qualified for a mortgage so you’ll know exactly how much you can afford. It will also show a seller or real estate agent that you’re a serious buyer. Keep in mind that just because you receive a pre-qualification letter from a lender doesn’t mean you’re automatically approved for a mortgage. Your official approval comes after you apply for a mortgage and the lender reviews your financial status in greater detail.

Applying For Your Mortgage
Once you’ve found the home of your dreams, the next step is completing the loan application and providing the required documentation. This will typically include W-2s from the past two years (and possibly tax returns), pay stubs covering the last 30 days, two months of bank statements, and a copy of the signed Agreement of Sale. Depending on your circumstances you might be required to submit more documentation. Your lender will also run your credit report.

Once your lender receives the proper documentation, your loan file will be submitted to underwriting for review. Your employment, income, credit, and financial history will be analyzed carefully. An appraisal will also be ordered by the lender to determine the market value of your property.

Lenders use many tools when reviewing a loan file. In addition to your credit history, they also analyze your proposed housing payment and other monthly debts in relation to your gross income. This is known as your Debt-to-Income ratio. This “magic” number can depend on many factors including the loan program you applied for, the amount of down payment and your credit history.

Once your application is approved, the lender will issue a Commitment Letter that spells out the terms and conditions that need to be met before the settlement can occur. If your loan is not approved, you may be asked to provide additional information to support your loan file so the lender can do a more in-depth review of your qualifications.

Prepare to Close
In addition to the documentation that you submitted, you will also need to provide a copy of your insurance policy, and your closing agent will need to submit a title package. After all the paperwork has been reviewed and accepted by your lender, the closing date will be scheduled with the seller. A day or so before settlement, you’ll receive final figures from your closing agent so you know how much money to bring to the closing table as well as a HUD-1 Statement which itemizes all the monies owed to each party in the transaction.

The big day is here! But before you can move in, be prepared to review and sign a lot of documents. Once that’s complete, you’ll receive the keys to your new home. Congratulations!

To learn more about TBI Mortgage, a subsidiary of Toll Brothers, and the mortgage process visit

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