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Once
the purchaser(s) and the seller(s) have agreed
on the price and terms of a contract, the next step is the loan
application. Brenda
Charlson can recommend several lenders who
have earned my trust
and with whom I’ve had good
experiences in the past.
Then,
a preliminary loan application
is completed with a loan originator. The loan originator’s goal is to
expedite all the necessary paperwork and information, including ordering a
credit report and appraisal of the property. It is very important for you
to get the appraisal as soon as possible. You will need to furnish the
lender with the information as outlined on the items needed for loan
application page.
The
information you provide
the lender is confidential. The application generally takes place
at the lender’s office.
All
people who will be on the title as new owners should be present. The
application normally takes about one hour. Sometimes
you will be required to pay in advance for your credit report (usually
$45-50) and the appraisal (usually $250-$350), which is required by the
lender to determine that the amount of the loan does not exceed the value
of the property. These are normally the only charges required by the
lender prior to the closing.
Your
loan originator understands
your concerns and is there to help with the approval of your loan. Feel
free to ask questions at the loan application about anything that you do
not fully understand. Also, you will receive a GOOD FAITH ESTIMATE OF
CLOSING COSTS at this time so you won’t have any surprises at the time
of closing.
Total
time from loan application to loan approval
averages between 20 and 45 days or more, depending on the loan type,
market conditions and/or the complexity of verifying the borrower’s
information and qualifications.
Homeowner’s
(Hazard) Insurance
A
Homeowner’s Insurance Policy
(or a Binder), also referred to as Hazard Insurance, will be required
to be brought to and paid for at closing. This is true in absolutely
all cases when financing of any type is involved. Even if you are paying
cash for the home, and no one is requiring the insurance, it would be
foolish not to protect your investment with Hazard Insurance. There are
many variables to consider in choosing which insurer and which policy best
meets your individual needs and preferences. These variables should be
carefully discussed with your insurance agent before purchasing the
policy.
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