What Happens After You Get Approved For A Home Loan?

What Happens After You Get Approved For A Home Loan?

What happens after you get approved for
a home loan? Are you supposed to just go start making offers on properties? I'm
gonna tell you exactly what to do. Let's go. We're going to give you 3 tips to make
your loan go faster and smoother. And I'm going to share with you three secret
insider tips of what you should submit and what you should not submit to the
lender during the mortgage process. When you are buying a home, the first process
is usually the mortgage loan process. And it can be very daunting for people
because it is a lot of paperwork, there are a lot of terms that most people have
never heard of and will never hear of.

And it is a whole new language in
process that just seems like it's never going to end.
But I'm going to tell you it is not as difficult as you think. And trust me, in
most cases, they want to approve you for the loan. So, let's talk about the quick
process. When you first go to a mortgage company whether it be a lender, a
mortgage broker or a bank, you are going to fill out an application, okay? And almost
all lenders use the same application that we call a 1003. Which is 1-0-0-3. And it is the Fannie Mae form, it's usually about four or 5 pages.
It's breaks down the type of loan that you're getting, your name, your
social security number, your birthdate.

Your 2 years of employment, your
banking information like how much you have saved in the bank your bank account.
And then it lists out all of the liabilities that are listed from your
credit report, okay? That is the primary gist of the loan application. And again,
it is pretty long because it asks a lot of different questions about you. However,
it is the same order almost every lender and it is not as difficult as you would
think. So, once you fill out the application, is going to go to a
processor. And the loan processor is the person that works at the mortgage lender,
that will order certain verifications. They will order certain documents. And
they will deal directly with you and usually the loan underwriter. The loan
underwriter is the person that will review all of the documents that the
processor in you and the loan officer gives them and they will make a final
decision. They are the decision-maker. And as a quick caveat, I will just quickly
share with you I used to be a mortgage underwriter. I did that for many years at
a lot of different banks.

And I even have some pretty
can certifications and mortgage underwriting. And I will tell you most
mortgage underwriters are just looking to make sure that you meet the
guidelines. So, I'll get into some tips and tricks later as to how you can
navigate around most underwriters. But that is the next step in the process.
Once they look at the documents and your conditions then they will send it over
to closing. You will go to the closing table and you close on the loan.

That's
the whole process. So, what happens where most people get really lost and confused
is what happens after they get pre-approved. The bank where the lender
has said you're approved for this amount and now it's time to either go find a
home or they're asking for certain conditions and you or the borrower does
not understand. So, let me clarify that part for you. So, the part that trips most
people up in the mortgage loan application process or the mortgage
process is the time when they are supposed to be submitting documents to
the lender. So, the lender is going to ask you probably several times. Hopefully you
have a good lender and they don't keep asking you for the same things over and
over again. Sometimes they do. But what they are usually asking for is your
income, your employment and your bank statements, your assets. So, they want to
make sure that you have enough money for the down payment.

They want to make sure
that it's been in the bank and it's seasoned.
Additionally, they want to kind of see what's going on with your bank account
to make sure that you don't overdraft your account and you know nothing crazy
is going on there. But the bigger thing that most people
are get confused on is when they start asking about income and tax returns and
they want to certain things explain to them. And this confuses or trips most
people up. And they usually in many cases, they don't submit anything. Or they just
kind of say, "Well, I'm not going to do this." And I don't want you to fall into that
category. If you have any issues whatsoever, I need to understand what
role each person plays in the mortgage process. Because this is so important.
Once you understand this, you will understand who's on your side in this
process. So, let's kind of break it down.

You first apply for your mortgage loan,
usually you were dealing with what's called a mortgage loan officer. This is
essentially a salesperson, okay? And in most mortgage operations, they call loan
officers salespeople, okay? Those are the salespeople. Those are the people that
goes and finds borrowers and people that want to do mortgage loans and they bring
those applications to the bank and then the processing. and the mortgage
underwriters, they work in operations and they process those loans. So, think about
this for a second. Most of the time, your loan officer is a salesperson. And they
are only paid on that loan if the loan closes. Now, the processor and the
mortgage underwriter, they are not paid usually on if your loan closes or not.

In
fact, in most cases, it's barred by the law. We've created a lot of regulations
around compensation in the mortgage business and they don't want the people
that actually look at the documents and approve people to have financial
incentives for improving the loans. So, I just told you something really big there.
Hopefully you got that. But the loan officer is not that person. They are not
a part of that process. They are incentivized financially by that loan
closing. So, if you have these questions and you're worried about what to submit,
if you don't have something, the best resource for you is your loan officer.
Okay? Because their compensation, their money, their commission is usually tied
to you getting approved and closing on that loan. Not just taking your
application, okay? I'm saying this as a licensed loan
officer, okay? I do not do mortgages but I do actually hold my license in the state
of Texas. And actually probably in Florida very soon. But I spent most of my
time in mortgage operations as a processor as an underwriter and then in
leadership even up to a vice president at Chase.

advocate

So, I'm telling you the mindset
on both sides is very different. And your advocate in getting your loan approve
lies with the sales team, okay? So, if you want to know if this is a document
should submit or if this is rider, you should ask your loan officer that
question. Now, again, they are employed and ethically they have a responsibility to
their lender. But they have a different mindset. They want to see your loan
close. So, they want to help you if they can. They're not going to do anything
illegal or an ethical. But if there's a way that they can help you get your loan
close, they will tell you.

They will tell you. They know things you don't know
so you shouldn't really be afraid of your loan officer. That's the key to this.
So, now that we've worked out the hardest part. So, now that you know what to submit
and they're asking you for your pay stubs or your bank statements is going
to then go to the processor. And the processor is going to review those
documents and then they're gonna also order some documents. They're going to…
You're going to send them their pay stubs for example. But they're gonna actually
call your employer and verify that you still work there and that the pay stubs
that you gave them are accurate. They're not you know fraudulent or anything like
that. So, the processor verifies a lot of the
information that you gave them. And that's their role. Their role is to
verify the documents and to order documents that they don't want you to
order. So, there's certain things of course like I said the verification of
employment.

You as the borrower, you're not going to provide that because you
could change it and make it to your benefit. So, the processor who is
employed by the lender, they will call and they will verify that information
for you. And so that is their role in the process and then they will get that over
to the underwriter who will look at those documents and approve your loan.
Now, the underwriter in the process holds a very very important role to the
mortgage process. If the underwriter asks you for certain letters of explanation,
this is very very common in the mortgage business. So, do not get tripped up about
this when they start asking you for letters of explanation. They want them
written by you in your words addressing whatever it is that they are asking. For
example, if your underwriter puts the condition on the loan and they ask
you to explain why you have so many inquiries on your credit report, you
would just write a letter explaining why. Were you shopping for a car? Were you
shopping for a home? Were you're checking out to see what the best deal
was? Whatever the answer is, you need to tell them that and be honest.
And if you opened up any new credit based on those inquiries, you need to
disclose that.

That's simply all they're doing. So, the underwriter often asks for
lots and lots of letters of explanations. I've seen underwriters that asked for
letters of explanation for everything. I was not necessarily that type of
underwriter. But the business has changed over the years and it is required by
Fannie Mae and Freddie Mac and to get the loan sold and things like that. So,
please don't take it personal. Just give them the letters as they're asking. Don't
add in extra information. Be direct and to-the-point. And if you do not know what
to write or if you are afraid to write something, ask your loan officer, okay?
Now, the loan officer should not write the letter for you or do anything like
that. But you can't ask your loan officer for guidance on what you should say or
how you should word it or a template on what how you should do it. Do not
hesitate to do that. But don't be afraid by that process.

It's usually just a
formality. And just as a quick bonus, I would be remiss if I didn't share with
you what's called A-U-S, automated underwriting systems. So, nowadays in the
mortgage business, most of the decisions go through what's called automated
underwriting system. It's an automated system that looks through your credit. It
looks through the income and it spits out a decision that the underwriter at
the bank will follow. So, it already has the guidelines loaded into it. So, for
example, if you were going to get a conventional loan, they would run
something called a D-U which stands for desktop underwriter. And they put all
your information in it integrates with the credit reporting system and all this
other stuff. And it spits out a decision that the underwriter, the processor, the
loan officer.

Everyone can see and look at really easily and all we have to do
then is verify the information that has been submitted to the system. So, it's
sped up the process for mortgage underwriting is given more objective
approval so they can't like discriminate against you. If they don't like how you
look in the picture or they don't like where you are in the country, it already
just factors in objectively should you be a proof for this loan without any of
the external stuff that sometimes humans bring into it.

So, it is a very good thing
and if you can get the opportunity to see you're a U-S or the
loan officer can discuss your a us decision with you, please ask to see it
so you can start to learn the business. Because it is amazing. And it is where
the business is going. I would love to see you guys all in person. I am doing
some training classes and they are 3 full of days of learning, okay? If you go
check them out, it is that growyour wealthevent.com. These trainings are
directly with me. They're small group. I literally take you to my properties and
show you everything. So, you can walk away after those three full days with a full
plan on what it is that you should be doing in your business so that you can
be successful and start living the life that you want to live.

I have enjoyed my
time as a real estate investor and I am enjoying teaching it to others and
watching their success. And I would love to meet you in person,
shake your hand, teach you answer your questions and get you to that next level
of success that you're looking for. This is Noelle. To your success..

As found on YouTube

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