Your mortgage loan must go through underwriting before you close and receive the keys to your new residence. But what does that even mean?.
So, you’ve conquered the underwriting beast, congratulations! But hold your horses, partner, the journey isn’t over just yet. Buckle up as we delve into the exciting (and sometimes confusing) world of what happens after underwriting, guiding you through the final steps before you can finally call that dream home your own.
Final Approval: The Green Light to Proceed
After the underwriter gives you the thumbs-up a sense of accomplishment washes over you. But remember this isn’t the finish line, just the starting pistol for the final leg of the race. Here’s what you can expect:
- Double-check, double-check: Your lender will meticulously review your documents to ensure everything is in order. This includes verifying your income, employment, and credit one last time.
- Closing Disclosure: At least three business days before closing, you’ll receive the Closing Disclosure (CD), a document outlining the final details of your loan. This includes your loan amount, interest rate, monthly payment, closing costs, and the amount of cash you need to bring to the table.
- Review, review, review: Compare the CD with the Loan Estimate you received earlier. If any discrepancies arise, don’t hesitate to contact your loan officer. Remember, even minor changes can impact your closing costs.
- Be a responsible borrower: Avoid any major financial changes like opening new credit accounts or taking out loans. These actions can affect your creditworthiness and jeopardize your final approval.
Closing Day: The Moment of Truth
It’s finally here! Don’t forget to bring your certified or cashier’s check for the down payment and closing costs. A ton of paperwork will need to be signed, but don’t worry—your loan officer will walk you through it all.
Loan Funding: The Final Hurdle
Once you’ve signed on the dotted line the lender will review your documents one last time and verify your credit. This final step ensures everything is in order before they release the funds to purchase your new home.
Congratulations, Homeowner!
With the loan funded the keys are finally in your hands. Now, you can kick back, relax, and enjoy your new digs.
Additional Resources
- Mortgage Reports: https://themortgagereports.com/39675/final-approval-from-the-underwriter-what-happens-next
- Waterstone Mortgage: https://www.waterstonemortgage.com/blog/mortgage-basics/2021/02/mortgage-underwriting-process
Frequently Asked Questions
Q: How long does it take to get final approval after underwriting?
A: Typically, it takes around two weeks, but there’s no guarantee. You can expedite the process by answering your underwriter’s inquiries right away and sending in more documents as soon as possible.
Q: Can my final approval be revoked?
A: Yes, unfortunately. Revocation may result from any major changes to your financial circumstances, such as getting fired from your job or obtaining new credit.
Q: What happens if I find errors in my Closing Disclosure?
A: Contact your loan officer immediately. They can help you get the errors corrected and ensure you’re not paying more than you should.
Q: What should I do after closing?
A: Congratulations! Now it’s time to settle into your new home and start making memories. Don’t forget to update your address with relevant institutions and enjoy the fruits of your labor.
What is Mortgage Loan Underwriting?
The process of carefully reviewing your loan application and financial status to make sure you meet the requirements for your mortgage loan is known as underwriting. To put it another way, it’s the mortgage lender’s method of determining the risk of giving you a big house loan.
If you’ve been pre-approved, a portion of this inspection will already be complete. Your loan will only go through a more thorough review to receive the final approval when it reaches the underwriting stage.
Many mortgage lenders, including Waterstone Mortgage, use an automated system to underwrite loans. Nonetheless, we continue to have a strong group of underwriters who make sure all relevant data is supplied and apply their knowledge to evaluate each case. They evaluate things such as your debt-to-income ratio, income verification, credit history, and more.
What Information Do I Need for Underwriting?
After submitting your loan application and receiving a loan estimate, you will need to submit a number of documents, such as:
- A copy of your driver’s license
- Last 2 years of W2 statements from your employer
- Last 30 days of pay stubs
- Last 2 months of bank statements (both checking and savings)
- Last quarter (3 months) of stocks/bonds/mutual funds/401(k)
This is the information your underwriter will use to determine your loan eligibility. Your loan originator will also pull your credit report and provide that to the underwriting team as well.