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Mortgage Lender: A direct lender underwrites the loan and provides the
money, then sells the loan to a bank. All decisions are made in-house, by
their own staff. A direct lender can sometimes offer a more generous debt to
income ratio, and can sometimes obtain faster approvals.
Often, the differences between the types of lenders will make little or no
difference to the buyer; the most important trait to look for is integrity. An
honest, knowledgeable professional will be able to advise you based on
your circumstances and will point you to the best product for your needs.
Mortgage Approval Process
Upon applying for a mortgage, you will submit all your necessary supporting
documents to your loan representative, who will submit them, along with the
mortgage application, to an underwriter. The
underwriter, a representative of the lender,
will review the application and render a decision,
whether to approve the loan, deny it, or
request additional supporting documentation
or explanation of discrepancies.
Also while considering the loan application,
the lender will order a home appraisal to
assess the value of the home. If the home is
appraised as less valuable than the mortgage
Whichever type of
lender you choose
to patronize, allow a
minimum of 30 days
for the loan approval
process. Delays are not
uncommon, so it’s best
to allow even more.
being requested, the application may be denied. The cost of the appraisal, usually
around $400, will be charged to you at closing.
Once you have been approved for a loan, you will need to lock in your interest
rate. Locking in a rate means that even if interest rates increase before you
close, you will still receive the loan at the original rate. The shorter you lock
your rate, the better rate you will get. There may also be a charge for long
locks. Sit down with your mortgage representative and discuss the probability
of closing within the specified timeframe and the various risks or benefits
of locking in a rate for a given amount of time. With new construction, in
particular, it can be difficult to determine when the closing will actually occur.
WE ARE EXPERIENCED. For 18 years, we have
issued title insurance policies and handled
closings in Lakewood… and the rest of the U.S.
732.905.9400 • WWW.MADISONTITLE.COM
2017 Lakewood Home Buyer’s Guide | 67