UNDERWRITING
Once all the documents are signed, the Mortgage Broker or Lender will put them all together in a package and submit it to the Underwriting Department of the lending institution. The underwriter verifies all the information, and makes a determination if the package qualifies with the risk with regards to the amount and the terms requested. If there are any issues that the Underwriting department needs clarified, your Mortgage Broker or Lender will request additional information from you.
Once all items are satisfactory to the underwriter then your file is placed in the category “cleared to close”. At this point you will be given the opportunity at least 24 hours before closing to examine the HUD-1 Settlement Statement. This statement will indicate the amount of funds you need to bring to the closing, if any, along with your deposits (for purchases only), closing costs and fees. If there are any items or amounts on this statement with which you are not familiar, this is the time to discuss it with your Mortgage Broker or Lender.If you are satisfied, a date will be set for closing along with who should be present and where the closing will take place.
CLOSING
An Escrow Agent will conduct the closing. The Escrow Agent should be able to give you a full explanation of all items on the HUD-1 Settlement Statement. At closing you will sign several documents, with the most common being the mortgage (which serves as collateral for the loan) and the promissory note (which states that you promise to repay the loan).
SPECIAL NOTE FOR REFINANCE
Please bear in mind that each time you refinance your loan, you are reducing the equity in your home. When you apply for a new loan, there are costs associated with refinancing. It is recommended that refinancing any loan should demonstrate a benefit to the homeowner. See Refinancing.
Please peruse the information on this site and take the time to understand what documents you are signing and ask as many questions as you wish from one of our professional members