Home Loan Process Guide
Find Out How Much You Can Borrow
Before you begin shopping for a home, determine how much you can afford. By answering a few simple questions, we can calculate your buying power based on standard lender guidelines.
You can also choose to get pre-approved, which verifies your income, credit, assets, and liabilities. It's recommended to get pre-approved before house hunting so you can:
Focus on properties within your range
Strengthen your negotiation position with sellers
Close your loan faster
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Loan-to-Value (LTV) & Debt-to-Income Ratios
The LTV ratio is the maximum loan amount a lender is willing to finance. Creditworthy borrowers can qualify for higher LTVs, sometimes up to 100%.
Lenders also consider your debt-to-income (DTI) ratio, which compares your monthly debt obligations to your income. As a rule of thumb, mortgage payments should not exceed one-third of your gross monthly income. A higher DTI may require a larger down payment.
FICO™ Credit Score
Your FICO™ score, developed by Fair Isaac & Company, measures your creditworthiness based on factors such as:
Payment history
Total amount borrowed
Length of credit history
New credit inquiries
Type of credit accounts
Each credit inquiry may slightly reduce your score. Authorize credit checks only after selecting a lender or broker.
Self-Employed Borrowers
Self-employed applicants face stricter documentation requirements. While traditional employees provide pay stubs and employment verification, self-employed borrowers typically must provide two years of tax returns to verify income.
Source of Down Payment
Lenders expect borrowers to fund down payments with personal savings. However, gift funds from acceptable donors are permitted with a signed letter confirming no repayment is required.
Select the Right Loan Program
Home loans come in different forms. Choosing the right one depends on your goals, finances, and how long you plan to stay in the home. The two primary loan types are:
Fixed-Rate Mortgage
Interest rates and monthly payments remain constant for the loan term (usually 15 or 30 years).
Best for you if:
You plan to stay in the home for 7+ years
You prefer consistent monthly payments
You want to avoid future rate increases
Your income and expenses will remain stable
Adjustable-Rate Mortgage (ARM)
Interest rates (and payments) can fluctuate over time.
Best for you if:
You plan to move within 5 years
You're comfortable with variable payments
You expect your income to rise in the future
By evaluating these factors and consulting with a loan professional, you can select the loan that best aligns with your financial goals.
Apply for a Loan
Ready to take the next step?
Start your loan application process today.
Begin Loan Processing
After submitting your application, the loan processing phase begins. Lenders assess two key factors:
Your ability and willingness to repay
The value of the property
The loan processor verifies your documentation and addresses any discrepancies.
Key Verification Areas
Income & Employment: Ensures your income supports monthly payments.
Credit Check: Reviews your payment history and existing obligations.
Asset Evaluation: Confirms funds for the down payment and closing costs.
Property Appraisal: Determines market value, considering location and zoning.
Additional Documentation: May be required depending on loan specifics.
Tips for a Smooth Approval
Complete your loan application fully.
Respond quickly to document requests, especially if your rate is locked.
Avoid transferring funds between accounts without documentation.
Postpone major purchases until after closing.
Stay available near your loan's closing date (or arrange Power of Attorney if traveling).
Close
Your Loan
Once approved, you'll sign the final loan documents—typically before a notary public. Carefully review all terms to confirm accuracy, including:
Interest rate and loan terms
Your name and property address
At Closing, Be Prepared To:
Bring a cashier's check for down payment and closing costs (personal checks usually not accepted).
Provide proof of homeowner's insurance and any required flood coverage.
Show photo identification.
For most loans, closing occurs soon after signing.
Note: For owner-occupied refinance loans, federal law provides a 3-day review period before final closing.
Ready to Get Started?
Let's begin your home loan journey today.