Mortgage Process Step 1

Take an honest and accurate assessment of your current financial situation.

  • Gather at least four recent pay stubs, W-2’s and/or tax returns.
  • Gather current statements for all loans and revolving credit

Calculate your household income, before taxes.

  • Make sure to include overtime, bonuses, or commissions.
  • Calculate your household income for an entire year, then divide by 12 to get your “monthly gross income”.

Next, estimate your monthly debts

  • Monthly debts usually include car payments, credit card payments, student loans, bank loans, or even child support payments.
  • Not included would be things like day care, cell phone, cable, or utilities.
  • Also, you should not include any debts that are almost paid off.

Mortgage Process Step 2

To determine what your house payment should be, you need to first calculate your “Debt-to-Income Ratio” or DTI.

Most mortgage companies use a DTI of 45% to determine the amount you can borrow.

To Calculate Your Home Budget:
Multiply your gross monthly income X 45% = total max payments. Subtract from your total max payments your current monthly debts and that = new home budget payment.
 

Mortgage Process Step 3

After you have an accurate assessment of your income and debts, the next step is to get pre-qualified by a Licensed Professional Mortgage Loan Originator, such as our partners at Hometrust Mortgage.

During the pre-qualification process,
your Loan Originator will:

  • Help explain the entire mortgage and home buying process to you.
  • Answer any questions or address any concerns you may have.
  • Review your income, assets, debts, and credit with you to establish how much home you can buy.
  • Tell you about all the different mortgage programs there are, and help you decide on the one that’s right for you.
  • And work with you to set your game plan as to what the next steps are for you to buy your dream home.

Mortgage Process Step 4

Now that you have your financial data already organized, applying for your loan is a snap! Just complete a loan application.

Once the lender has received your initial application, a licensed Mortgage loan originator should contact you to review your information together. During this review, your loan originator will be able to answer all your questions about the mortgage process, including looking at different mortgage options to help you select the one that’s right for you.

They will review all the documentation needed to complete your home closing, and provide you with a detailed explanation of mortgage interest rates and closing costs.

Lastly, we will go over the final steps in the process. This will be important to make you feel comfortable, knowing what to expect along the way.

Mortgage Process Step 5

As your new Twilight home nears completion, it will be time to get start preparing for your closing. Around 45-60 days prior to your estimated closing date, you will want to begin making final preparations. This is a good time to touch base with your mortgage team. Your loan originator will be able to discuss the current interest rates, and see if you want to lock-in your rate. Your loan processor will begin to update your loan file with current information.

If you were saving funds to close, you will want to check in with your loan originator to see how you are tracking. This is also a good time to review your application and let them know if anything has changed.

Additionally, you will need to get your hazard insurance lined up, and ready for closing. When you have selected your insurance agent, you can have them contact your loan processor to make sure they are all set for closing.

Lastly, when the closing day arrives, you will sit down with a title agent/ closing agent to do your final paperwork. At the closing, you will be asked to bring your photo ID and your funds for closing. Your title/closing agent will tell you the exact amount to bring, and will give you detailed instructions. Then there’s nothing left to do…but move in!