How To Buy A Home In Texas
Simplifying the Process
The Texas Loan Process
The Texas mortgage loan process operates on a set of fundamentals that are universally applicable to all loan types. Once an application is submitted, the credit review and employment verification are conducted, which are crucial stages in the loan processing journey. Supporting documentation such as tax returns, W2s, pay stubs, bank statements, and investment records are typically required to complete this step.
The mortgage loan application form requests comprehensive information about you and the property you intend to purchase, as well as documentation about your personal finances. After scrutinizing this information and assessing your credit history, the lender will proceed to the subsequent stages of the mortgage loan process.
At various stages of the loan process, we will require you to furnish us with multiple documents that will be provided to the underwriters. The underwriters may also request additional documents during the underwriting process.
At Flagstone Mortgage, we understand that buying a home is a significant financial decision. That's why we offer a pre-qualification service to help you understand your home buying potential.
Getting pre-qualified involves providing us with basic financial information, such as your income, debts, and credit score. We use this information to estimate the mortgage amount you could potentially qualify for. This service is entirely free and doesn't require a commitment to use our services in the future.
Getting pre-qualified gives you a clear idea of what you can afford, which helps you focus your home search and avoid disappointment later. It also demonstrates to sellers that you are a serious buyer, which can be a valuable bargaining chip when negotiating a sale.
There are two types of application forms: the short form and the long form application. The short form is available on our website and is designed to provide us with the essential details of your mortgage application so we can initiate the loan process and pull your credit. This form requires basic information such as your name, contact information, income, and loan amount requested.
The long form application is the complete mortgage loan application that asks for more detailed information about you and the property you wish to purchase. This form requires documentation about your personal finances, such as tax returns, bank statements, W2s, and investment records. The long form application allows us to gain a comprehensive understanding of your financial situation, which helps us determine the best mortgage loan option for you.
Our processors will verify many items, including your income, employment, and assets, before submitting your file to the underwriter for approval. This verification process involves phone calls and the receipt of documentation from your employer to ensure that all the information provided in your application is accurate and up-to-date.
Additionally, if you have an existing mortgage, we will order a payoff from the current mortgage holder(s) and run a title search to verify that all liens have been resolved. Once this information has been confirmed, your file will be sent to the underwriter for approval.
During this stage, it's crucial to provide all necessary documents to our processors to ensure that your application is processed as quickly and efficiently as possible. The documents required at application include your most recent pay stub (within 30 days), two months of current bank statements, a copy of your driver's license, two years of recent tax returns (all pages), and the most recent quarterly statement for your retirement/investment funds.
Once your loan application has been processed and approved, we will order an appraisal of the property from an independent appraiser. The appraiser will visit the property and conduct a thorough inspection to determine its condition, features, and any necessary repairs.
The appraiser will also research and analyze similar properties in the area to determine the fair market value of the property you wish to purchase. This valuation is based on various factors such as location, size, age, and condition of the property.
The appraisal report will then be sent to us, and we will review it to ensure that it meets the requirements of the loan program you have selected. If the appraisal meets the necessary criteria, we will proceed with the loan process. However, if the appraisal falls short of the required value, we may need to reassess the loan program or renegotiate the terms of the sale.
During the underwriting process, our team of underwriters will review your application and all supporting documentation to assess your creditworthiness, income, employment history, and other factors that impact your ability to repay the loan. They will also verify that all information provided is accurate and up-to-date.
Our underwriters work closely with our processors to ensure that all necessary documentation is collected and analyzed thoroughly. They may also ask for additional information or clarification if needed to make an informed decision.
Lock In Rate, Get Escrow and Title and Close
Once your loan application has been approved, and you have selected the loan program that suits your needs, we will lock in your interest rate. This rate lock-in period typically lasts for a specific number of days, and it's essential to ensure that your loan closes within this period.
During this period, we will work with you to secure an escrow account to hold your mortgage payments and any necessary funds for property taxes and insurance. We will also perform a title search to verify that the property's title is clear and free of any liens or encumbrances.
Once all necessary documentation has been collected and reviewed, and the title is clear, we will schedule the closing of your loan. The closing typically involves signing the final loan documents, paying any necessary fees and costs, and transferring ownership of the property to you.
Documents We'll Need
Depending on how you are employed and earn your income will determine what documents we'll need from you to process and underwrite your loan.
Option 1 - Wage Earner
Click Here if you are employed by a company and receive a paycheck and W-2 from your employer. If you have more than twenty-five percent ownership go to the Self-Employed Option.
Option 2 - Self-Employed Borrower
Click Here if you own your own business - for underwriting purposes if you own more than twenty-five percent of a company you are considered Self-Employed.
Option 3 - Commission Employees
Click Here If twenty-five percent or more of your income is from commissions and/or bonuses.