After you have met with your lender, you may be confused on what happens behind the scenes...
Here is a little insight...
1. Meet with your loan officer. Decide what program is best for you.
2. Loan officer will run a credit report, and get a pre-approval from Fannie Mae or Freddie Mac.
3. Your loan officer will collect some documents from you to make sure that you able to buy a home. These documents typically include (and are not limited to) your past 2 years W2's and/or tax returns, copy of your driver's license and social security card, past 2 months bank statements, past 30 days paystubs.
4. Your loan officer will give you an application to sign with many different documents including the 1003 (loan application), the Good Faith Estimate (that shows what your closing costs are estimated to be), the Truth In Lending Document (that shows what your APR is), etc.
5. Once you are approved, if you are buying a home, you need to write a contract and give your realtor (or someone who is involved) your earnest money. If you are refinancing, no earnest money is involved.
6. You will decide with your loan officer (once you have a property address) if you want to lock into a rate or keep it floating.
7. An appraisal and title are ordered on the property.
8. The loan officer sends the loan through to the processer to:
a) reconcile the loan file
b) review the appraisal, title, credit report
c) prepare submission package
d) comply with Lenders' approval requirements (they differ for all investors)
e) schedule and coordinate closing
9. The loan is submitted to underwriting for approval.
10. If the loan is approved, the closing documents will be prepared, and the customer will receive the HUD-1 Settlement Statement no later than 24 hours before closing
11. Either the title company or the lender will close the loan for you, and the funds will be sent to realtor, title company, insurance company, seller, etc.
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