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Mortgage Process

Home Loan Process for Buying California Properties

There are many steps in the home buying process, and many relate to obtaining financing. It may be confusing for both new and experienced buyers. This blog provides important details about home loan process for buying California properties and covers what you may want to know before beginning a home search.

Home Loan Process for Buying California Properties

  • The Pre-approval
  • A pre-approval is a preliminary review of your finances and credit report to estimate what you may be able to receive as a mortgage. It verifies that you have the primary criteria for a mortgage. Pre-approvals are not a guarantee that you will ultimately be approved for financing, but is a typical first step in the process.

  • Applying for Financing
  • A formal application occurs normally once you have an agreement to purchase a home. You may be asked for additional financial information. The details on the home are also submitted to the lender for review. They will require a copy of the Purchase and Sales agreement in order to proceed. Your contract will typically require that you submit an application prior to a specific date.

  • Mortgage Appraisal
  • An appraisal is ordered by the lender (although buyers are always carry the burden for the cost) to determine the exact market value of the real estate. Appraisers will compare your home to others that closed in the area within the last several months. A specific dollar value is generated. Basically, the value of the property must justify the mortgage amount.

  • Commitment Letter
  • After your personal information and the details on the home are reviewed, the lender provides a letter of commitment. This confirms that no significant problems are present and that the lender is somewhat sure that the mortgage will obtain approval. There may be a few conditions noted in the commitment such asan employment verification and additional credit score pull. It is therefore essential not to make significant purchases or alter your financial situation even after a commitment is issued as it may lead to a fall thru.

  • Preparing to Close
  • A clear to close is usually the ending approval for financing. It verifies that all criteria have been met and that the lender can send the information to the closing agent. This may take place merely days prior to the anticipated closing date.

  • Finalizing the Purchase
  • The settlement involves signing of forms and filing of information at the Registry of Deeds. Be sure to bring acceptable I.D. and certified funds for any monies due. Personal checks or cash are traditionally not acceptable.

  • Some Additional Advice
  • Deadlines are a critical part of any real estate transaction, so make sure that you understand the dates and what you must complete to meet each one. Working with an experienced mortgage professional and real estate broker is a huge help. They will offer guidance and support, monitor deadlines, and ensure a more positive experience. As a local real estate professional, I will offer help with the mortgage and overall home buying process. You may reach me, Almila Gozen, at Sotheby`s International Realty® via email at almila@almilagozen.com.