What Happens After Your Mortgage Application Is Submitted?

You’ve submitted your application for mortgage approval. Once this first step is complete, many first-time homebuyers are left wondering what comes next. The mortgage approval process is not always intuitive. By knowing what steps to take, you can ensure an easier experience. A.S.A.P. Mortgage Corp. helps families and individual homebuyers with mortgages. Here, we provide a summary of the mortgage application process.

Key Takeaways

• After submission, the application will be reviewed, the lender verifies your documentation and issues a mortgage loan estimate.
• Once a purchase offer is accepted, the mortgage enters underwriting to confirm that the home value is equal to or greater than the loan requested.
• Conditional approvals mean that your loan is approved, but further documentation is required before the money will be issued.
• At every stage of the mortgage process, stay in touch with your lender and be patient.

What Happens Immediately After Submission?

After a mortgage application is submitted, it enters the review process. During this stage, the lender examines your application and verifies your documents to ensure that everything is valid. The lender wants to establish that you are a reliable borrower who can be trusted to make loan repayments on time. To confirm this, the lender will take these actions:

• Verify your income, employment status, and employment history
• Review your current assets and bank statements
• Check your credit and debt obligations

At the end of the approval process, the lender will provide an initial loan estimate, representing the amount that it is willing to let you borrow. Your estimate should guide your decisions while shopping for a house within your budget. It can also provide leverage when negotiating a buying price.

What Happens During Underwriting?

The underwriting phase begins when your offer on a house is accepted. During this phase, the lender wants to confirm that the property is worth your loan and will order an appraisal to determine the property’s market value. The appraisal involves two primary components:

• Inspection: A professional appraiser visits the property to evaluate its square footage, condition, location, and other features that affect its value.
• Market comp analysis: The appraiser analyzes the current housing market and checks the cost and appraisal values of similar properties.

If the house was correctly valued, then your financial documents will be reviewed once again to make sure that there have been no changes in your financial status. The lender will then issue a conditional approval. This means that the mortgage is approved, on the condition that a few more requirements are met. These requirements might include:

• Updated financial documentation
• Explanations for unusual financial activity
• Proof of homeowners insurance
• Clarifications to the home title

So long as the requested documents are provided, the loan is approved. You are clear to close, meaning that you can move forward with your purchase of the home.

Tips and Advice for the Mortgage Process

While the application is the most important step in mortgage approval, there are other ways for buyers to help the process along. The following help to ensure a smooth approval with minimal delays:

• Stay in contact: Your lender may have questions during the approval and underwriting process. Prompt responses will keep your application moving forward.
• Control your debt: Avoid taking on new debt while the loan is being processed. Changes to your debt-to-income ratio can impact your approval.
• Be patient: Most of the mortgage process happens behind the scenes. Just because you can’t see any changes does not mean that the process is not ongoing.

Your mortgage broker will assist by providing additional advice, guidance, and answers to your questions and concerns. The broker will also facilitate communication with the lender, resolve document requests, and otherwise smooth the approval process.

Learn More About the Mortgage Approval Process

Are you ready to apply for a mortgage and buy your first house? Trust A.S.A.P. Mortgage Corp. to help. We are mortgage brokers with offices near you in the mid- to lower Hudson Valley region in New York and the NYC Metro area. We provide comprehensive support for prospective homebuyers across multiple states, including New York, Connecticut, Tennessee, Pennsylvania, Massachusetts, New Jersey, and Florida. To learn more about the mortgage approval process, contact us today.

FAQ about Mortgage Readiness

What happens if the appraisal comes in low?

If your home appraisal comes in lower than the purchase price, then the lender will only approve a loan for the appraised value. You have a few ways forward if your appraisal came back lower than expected:

• Challenge the appraisal
• Renegotiate the sales price
• Consider an all-cash offer

An experienced mortgage broker can help you understand your options and make the right call depending on your available resources.

How long does the mortgage review process usually take?

The initial mortgage review for the conditional approval typically takes 24-72 hours. Several factors may impact the timeline, including appraisal scheduling, title work, and whether the lender needs additional documentation. The timing of initial submission to clear to close will vary depending on the type of transaction but normally 30-45 days. However, some transactions can close in as little as 2 weeks.

Why might a lender ask for additional documents?

Lenders may ask for additional documents if they are needed to confirm or clarify your finances. Providing clear, accurate documentation is important to ensure a smooth lending process with no delays.