Step 1 – Get preapproved for a mortgage and determine what payment you are comfortable with.
Most experienced Real Estate Agents will require, or at least strongly urge, prospective homebuyers to get preapproved for a mortgage before seeing a home or making an offer. No reason to get excited about a home you don’t ultimately qualify for or can’t reasonably afford. Even if you happen to see a home you love, a buyer’s agent is extremely unlikely to present your offer to the seller without a preapproval letter in hand. Listing agents don’t want to accept your offer, have the listing go into escrow, and then have escrow canceled when the buyer cannot obtain financing.
Through us, the preapproval process is easy!
- Complete an application on our website. (link here)
- Collect the documents listed on our website. (link here)
- Upload the items securely to us on our website. (link here)
Once we receive your documentation and application, We run a credit report and will send you a preapproval letter in as little as an hour.
If you don’t qualify for the mortgage you seek, we will clearly identify why. Decades of experience let us identify potential hurdles or problem areas… And to address these problems BEFORE you are in contract to buy a home.
Step 2 – Shop for a home!
If you are not working with an agent, ask us for our recommendation for a local real estate agent. We’ve handled thousands of purchase transactions, and we often know the seasoned agents in a particular area.
If you want to keep your options open with your agents, browse homes on Redfin. We often use Redfin to find sales information.
It can take months to find the right home, and a lot can change with interest rates and payments over that time. We’ll be happy to send you updated rates tailored to your loan scenario anytime you would like.
Before making an offer, please let us know if there are any HOA dues or Mello-Roos we may not have been accounting for when determining your ability to qualify for a home.
Please avoid opening any new credit lines while you search for a home. If you have taken on any new debt, please let us know ASAP so we can re-run the numbers and make sure you still qualify for the home you want.
If your income or employment has changed, please let us know asap.
Step 3 – Make an offer on a home!
Many listing agents (agents representing the seller) want to see a current preapproval letter, and buyer agents would like the numbers on the preapproval letter to match the offer. We are happy to update the preapproval letter anytime you or your agent would like.
When you make an offer, consider asking for a seller credit toward closing costs if you don’t want to put down more than the minimum.
A big portion of closing costs are title and escrow fees. Typically, the seller decides which title and escrow company to use, but you can certainly request any title and escrow company you would like with your offer. Since we see fee estimates from many different title and escrow companies, we’ll be happy to recommend one.
We also recommend working with a local escrow office so you can go into their office and sign if there is a time crunch at the end of the purchase process. If the escrow office isn’t local, there could be delays, which can make closing more stressful.
Step 4 – Lock in your interest rate after your offer is accepted.
Buying a home will likely be the biggest purchase of your life. Because of this, the process will be a little stressful no matter how easy we make the financing process. You will have enough to think about during escrow that it’s nice not to worry about your interest rate and payment increasing. That is why we recommend locking your rate upfront after your offer is accepted, so you can focus on home inspections and the paperwork required for the home loan.
As a broker, we can move your purchase loan to a different lender if rates fall dramatically within a couple of days of locking. Big Banks and Credit Unions can’t offer you that option!
Step 5 – Send your Earnest Money Deposit (EMD) to escrow.
Typically, the required deposit is 3% of the sale price, but this can vary.
Before sending your deposit to escrow (we prefer that you wire the funds), let us know which bank account (or gift funds) you are using so we are on the same page.
If a family member is gifting funds and all or part of the gift will cover the EMD, have them wire the funds directly to escrow instead of sending the money to you and then having you send it to escrow.
Please call escrow directly to confirm the wiring instructions before wiring the EMD. Sadly, people have been sending fake emails trying to get people to wire funds to fraudulent accounts lately.
Step 6 – Sign the initial loan disclosures we send you and send us any updated documents we request.
With a purchase, it’s important to move quickly during escrow because your contract has deadlines you must meet. One deadline is a loan contingency, which is typically 7-17 days. After your offer is accepted, the seller will ask you to remove your loan contingency within that timeframe. To get full approval from the lender in 7-17 days, we need to keep the process moving.
Just because you sign initial disclosures doesn’t mean you are committed to the loan or the house, for that matter. You still have at least 10 days (depending on your contract) to back out of a purchase contract as you inspect the property.
Once we have your initial disclosures and current income documentation, we’ll submit your loan application to the lender, and depending on which lender we work with, we’ll have an approval within 24 to 72 hours.
We’ll need you to get a homeowner’s insurance policy for the new property. Go ahead and set the effective date to the day before closing, and we can adjust it as we get closer to closing. Having the insurance policy before we submit your file to the lender will expedite the process.
Step 7 – Schedule your home inspections.
Now that you are under contract, it’s time to give your potential new home a full examination.
We would recommend finding a well-reviewed home inspector on your own instead of taking a recommendation from your agent, or certainly the listing agent, just so there is no conflict of interest.
Let us know ASAP if anything in the home inspection requires you to cancel the purchase contract. This way, we can cancel the appraisal before you pay for it. Agents always want to order the appraisal ASAP, but they aren’t the ones paying for the appraisal. It’s best to make sure everything is in good shape before spending additional money on the appraisal.
Pest inspections are typically paid by the seller.
Any other specific inspections, Chimney, heating and air…etc. would be paid by you. Again, please tell us ASAP if any inspection findings might jeopardize your purchase.
Step 8 – Order your appraisal.
Once you sign your initial loan disclosures, we’ll order your appraisal.
The lender will require a carbon monoxide detector on each floor of the home, and the water heater (unless tankless) will need to be double-strapped to the wall for safety.
Step 9 – Your loan is approved by the lender. Now you need to satisfy the underwriter’s loan approval conditions.
Even if you are worth millions and earn millions each year, the underwriter will likely want additional documentation or clarification after reviewing your loan application. Try not to take it personally; underwriters are just doing their jobs.
Our lenders typically sell your loans to Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac require that each loan be thoroughly underwritten and properly documented or a lender runs the risk of having to buy back a loan from Fannie or Freddie. Our lenders don’t want to lose liquidity by having to buy back a loan, so they’ll make sure your file is properly documented.
As long as you provide all the documentation we request upfront, we likely won’t need much more after you receive loan approval. We may just need an updated bank statement or pay stub. We try to anticipate what an underwriter is going to require, and we request all of these items from you upfront – this tends to make things easier toward the end of the process.
Step 10 – Time to sign your Closing Disclosure (CD).
Shortly after we receive your loan approval and appraisal report (and in some cases, before then), we can request your Closing Disclosure from the lender. The Closing Disclosure shows a rough estimate of all of the closing figures. The figures on the Closing Disclosure should be slightly more accurate than your initial Loan Estimate, but the CD is still just an estimate. Escrow can adjust figures, like interest due at closing, before closing.
You must electronically sign your Closing Disclosure 3 days before you can sign your final loan documents. In general, you should review and sign all disclosures the lender sends via email. Again, these are just disclosures; nothing is binding, but to stay on schedule and avoid delaying your closing, it’s important to review and sign disclosures emailed by the lender. We’ll remind you when itis especially important to review a document quickly.
Step 11 -Your loan is “cleared to close” by the underwriter!
Once you send us all of the underwriting conditions, we’ll send them to the underwriter, and the underwriter will hopefully sign off on the documents you sent as well as your appraisal report.
Once your loan is cleared to close, we will be comfortable recommending that you remove your loan contingency with the seller. You can rest assured you won’t lose your earnest money deposit, and you will be in a position to close shortly.
Step 12 – Loan docs out.
Once your loan is cleared to close, we’ll have the lender send the loan documents to escrow.
Once docs are in escrow, a notary will call you to set up a time to sign. In general, try to sign as soon as possible so we can do our best to close on the date that you would like.
We’ll request an estimated closing statement from escrow and email you a breakdown of the figures. This way you can review the numbers before meeting with the notary and we can go over any questions you might have before your signing.
Step 13 – Sign your final loan documents with a notary
Once your final loan documents are with escrow, they will arrange for a notary to call you and schedule your signing.
Be sure you have your unexpired driver’s license available when you meet with the notary. The signing should take 10-30 minutes depending on the number of documents that need to be signed in person. Lenders are making the signing process easier these days. You may be able to sign some documents electronically before you meet with a notary, and you may be able to sign your loan documents remotely with an online notary.
Step 14 – Wire closing funds to the title company
After you sign your loan documents with the notary, you will need to wire the remaining funds needed to close to the title company. Your estimated closing statement shows the amount needed to close, and your loan documents typically include wiring instructions when you meet with the notary. It’s a good idea to call the escrow/title company to confirm the wiring instructions before you initiate the wire. Be sure to wire the funds to title asap after signing with the notary. Typically, the next day is fine, but if there is a time crunch, your loan officer may want you to wire the funds the same day you sign your final loan documents.
Step 15 – Satisfy any final lender funding conditions
Some lenders will have “prior to funding” underwriting conditions, where an underwriter may want to document exactly where the closing funds came from. Usually, the wire receipt escrow provides to the lender is sufficient, but if you wire funds from an account different from the account(s) you provided your mortgage broker, the underwriter will need a paper trail for the closing funds.
Step 16 – Your loan funds!
Once all of your prior-to-funding conditions are satisfied, the underwriter will authorize funding, and the lender will wire the loan proceeds to title.
Step 17 – The Deed of Trust and Grant Deed are recorded with the County, and the home is officially yours!
Once your title records the Grant Deed (transfers ownership from the seller to you) and Deed of Trust (creates the legal lien on the property securing the lender’s financial interest, naming the borrower, lender, trustee, legal property description, and loan amount), the home is officially yours!
Community First Mortgage has helped clients navigate the purchase process for over 40 years, and we have closed over 10,000 loans. Let us help you through the mortgage process and help you secure the best rate possible! We are the #1-rated mortgage company in Ventura County on Yelp, and we are licensed to work with clients throughout California.
Start an application or request a free rate quote by clicking the buttons below. We look forward to working with you!
