Updated: Jun 8, 2018
If this is your first time purchasing a home, every step of the process has been new to you. You’ve asked your agent for guidance and they’ve been there with all the answers (We hope. If not, call us!). Despite how you’re being advised, it’s difficult to visualize certain aspects of the buying process that have many steps or layers.
Once your offer has been accepted, what follows is the actual ‘meat and potatoes’ of the transaction. The part where all the substantial steps take place. We visualize the process unfolding in 3 parts simultaneously: Property, Title, and Financing. Each part is intertwined or dependent on the other to finalize the sale.
Buyer submits offer
Price is agreed on.
Escrow agent is selected
Escrow deposit shows buyers intention to purchase property.
Ordered and paid by the buyer.
Inspection reveals property defects.
Buyer requests credits from seller for defects.
Keys are given to the new owner.
Title company orders a survey of the property.
Survey details the boundaries of the property.
2. Title Abstract
An abstract ensures the property is free of any liens or claims by debtors or heirs.
3. Collect Documents
Title company orders all loan documents from the lender.
A HUD-1 Settlement Statement is completed. This statement documents the costs involved in the sale of the property.
Documents are explained to all parties before being signed.
All monies related to the sale of the property, including the loan, are collected and disbursed.
Loan documents are returned to the lender after signatures are collected.
The new deed and mortgage are delivered, after closing, to the courthouse for record keeping.
1. Loan Application
The buyer applies for a mortgage through a mortgage.
Buyer sends their personal financial information to the lender for review.
2. Loan Process
The lender reviews buyers financial information.
Loan Commitment is issued if financial information is satisfactory.
Lender orders appraisal of property to determine value.
The loan application is given to an underwriter who assesses the risk level of the buyer.
3. Loan Approval
Proof of homeowners insurance is provided to the lender.
Lender receives underwriting confirmation from the underwriter.
Loan is approved.
Lender disburses loan amount to escrow account held by title company.
Buyer pays the remainder of the down payment and any other costs related to the financing process.