A mortgage is the process used by people to raise money to buy a property or by which property owners try to raise capital. It is a complex procedure that involves a lot of steps for successful completion. It also requires the services of a lot of professionals in order to successfully complete the entire process.
The mortgage loan process starts from the time a borrower applies for a loan. For this, the borrower needs to fill out a number of forms. These forms usually contain details about the applicant. They are also required to submit a large number of documents. These documents are the different proofs that are needed by the lending party to verify. The form and the documents are then submitted to a mortgage processor. Some of the documents that are needed to be submitted by the applicant include their bank details, their pay stubs and their tax returns. These details are going to be verified by individually calling each source. Whether it is the banks, or the employer, the mortgage processor calls each individual to validate all the details submitted in the form of applications.
The lender is involved in the next step. All the verified documents are sent to the lender along with the application form. The lender on his part also carries out the verification. He starts with the title deed and also begins with the appraisal process. The lender then passes on all of the information to the underwriter. The underwriter is the final power that decides whether the loan will be approved or not. He checks the credit history of the person who has applied for the loan as well as validates the titles deed.
If the underwriter decides that the application isn’t enough for loan approval, he rejects it and sends it back to the loan officer. The loan officer works in conjunction with the processor to see if there are some steps that would increase the chances of loan approval. This again involves long and tedious processes to acquire the additional information that would help the loan seeker’s application.
If the underwriter approves the loan, he sends back the file to the lender. The lender then sets up a loan closing date in conjunction with the loan seeker. The loan seeker can use this date to close the deal with the property seller too. Care needs to be taken at every step of the approval process because government regulations change regularly. This can cause problems if they aren’t taken into account.
Financial companies that provide this service find it to be a very cumbersome process due to the legalities involved. From getting trained professionals to the right software and tools, the expenses and effort required by companies make it an attractive solution to get outside help.