You may think getting approved for a mortgage is a long and drawn-out process.  While that may be the case with some lenders, it’s not when First National Bank at Darlington provides your home financing.  To help you better understand the process, we’ve provided a step-by-step guide.

Step 1 - Initially, you will submit a Residential Mortgage Loan Application.  You may do this by meeting in person with our Mortgage Loan Officer, or by mailing or faxing in your application.  No matter how your application is submitted, you will work with an experienced Mortgage Loan Officer throughout the entire process.  Please feel free to Contact Us to request an application.

During this initial step you will also be asked to provide us with a check to cover the cost of ordering your credit report and your appraisal.  You will also need to provide documentation in order to get your loan approved.

Once your application has been received, your Mortgage Loan Officer will gather all the supporting documentation required before your loan is reviewed for an approval.  This step is often referred to as “processing” your loan application.  A copy of your credit report will be ordered as well as verifying employment, assets, liabilities, etc.

It is during the processing stage that your loan application will be submitted to an automated underwriting application like Fannie Mae’s Desktop Underwriter or Freddie Mac’s Loan Prospector.  The use of these software applications has become an industry standard and makes the review of your loan much quicker and standardized to ensure adherence to fair lending practices.  It has also reduced the amount of paperwork required to get a loan approval.

During processing, an appraisal of your property will be ordered.  This is used to determine the value of the home you are purchasing or refinancing.  This appraisal will be completed by an independent fee appraiser.  The appraiser will contact you for access to the property soon after the actual appraisal is ordered.

Within three business days of submitting your application to us, we will provide you with a Good Faith Estimate of Closing Costs and a Truth In Lending Disclosure.  These important documents are to help you review the estimated costs you may incur with your pending loan transaction.  Be sure to review these carefully and ask your Mortgage Loan Officer any questions you may have.

Step 2 - Once all the documentation for your loan application has been received, the loan is sent to the next phase in the process.  This is called Underwriting.  During Underwriting, the file is reviewed to make sure it meets the guidelines of the bank’s specific loan program for which you are applying.  Underwriting will review:

• Credit - how you’ve paid your debts in the past.

• Capacity - which is your actual liability to repay the loan based on your income and other debts you are paying.

• Collateral - the value of the property you are buying or refinancing and are pledging as “collateral” for the loan.

While we try to obtain all required documentation prior to the file going to Underwriting, additional documentation may be required during the process.  Underwriting will make the loan decision regarding your application.

If your loan is not approved, DON’T PANIC!  Talk with your Mortgage Loan Officer about the specific reasons your loan was not approved.  See if further information may be provided to gain an approval.  Or, if a plan of action could be put into place to work through the underwriting issues.

Step 3 - If the loan is approved, you are ready to move to the final stages of the process.  This step is referred to as closing.  We will work with the closing agent to prepare the documents required to close the loan.  You will actually go to the closing agent’s office to close the loan.  Closing is simply signing all the necessary legal papers to formally complete the loan transaction and for the loan proceeds to be disbursed.

Closing culminates the loan process.  Shortly after closing you will receive information about the schedule of your monthly mortgage payment.  If you have not received this information by the time your first payment is due, go ahead and make your payment.  During the closing process you will receive a First Payment letter that lists the correct payment and the post office box where your payment should be sent.  

Calculate your monthly mortgage payments with our Mortgage Minder here!