After Your Loan Application

Applying for a mortgage is a major milestone, but what happens after you submit your loan application? Many homebuyers assume the hard part is over once the paperwork is complete, but the truth is that the process is just beginning. At Crescent Title, we believe that understanding what comes after your loan application can help you feel more confident and prepared as you move forward toward closing day.

Here is a detailed look at what happens after you apply for a mortgage, and how you can help ensure a smooth and successful closing.

1) Loan Processing Begins

Once your loan application is submitted, your lender will begin the process of verifying all the information you provided. This step is known as loan processing. The loan processor’s job is to organize your file, review your documents for accuracy, and gather any additional information the lender may need.

Common items reviewed during loan processing include:

• Income verification documents, such as pay stubs and tax returns
• Employment verification directly from your employer
• Bank statements and proof of assets
• Credit reports
• Debt and liability statements

If any documents are missing or additional clarification is needed, your processor will contact you. Responding quickly and providing complete information helps keep your file moving forward without unnecessary delays.

2) Home Appraisal Ordered

A key part of the loan approval process is the home appraisal. Your lender will order an appraisal to determine the fair market value of the property you are buying. The appraiser is an independent third party who provides an unbiased opinion on the property's worth.

The appraisal protects both you and the lender. It ensures you are not overpaying for the home and confirms that the property meets the minimum standards for the loan program you are using.

If the appraisal comes in at or above the purchase price, the loan moves forward. If the appraisal comes in lower, additional negotiations may be necessary between you and the seller, or you may need to bring extra funds to the closing table.

3) Underwriting Review

After processing and appraisal, your loan file moves to underwriting. The underwriter's role is to thoroughly evaluate your financial profile, the property, and all supporting documents to determine if the loan meets the lender's guidelines and requirements.

During underwriting, the underwriter will:

• Analyze your creditworthiness
• Confirm your employment and income
• Review your debt-to-income ratio
• Assess the appraisal report
• Verify your assets and savings

It is common for the underwriter to request additional documents or explanations during this stage. These requests are not unusual and do not mean your loan is in jeopardy. Promptly providing any requested information will help maintain momentum toward approval.

4) Conditional Approval

If the underwriter is satisfied with most of the documentation but needs a few more items before giving final approval, you will receive a conditional approval. This means your loan is on track but is subject to you meeting a few final conditions.

Typical conditions might include:

• Updated bank statements
• Letters of explanation for certain credit items
• Proof of homeowner’s insurance
• Final verification of employment

Fulfilling these conditions as quickly as possible is important to keep your closing date on schedule. Your loan officer or processor will guide you on exactly what is needed.

5) Final Approval and Clear to Close

Once all conditions have been satisfied, the underwriter will issue a clear to close. This is one of the most exciting moments in the homebuying process. It means your loan has been fully approved and the lender is ready to move toward closing.

At this stage, you will receive a Closing Disclosure, which outlines all the final terms of your loan, including your monthly payment, interest rate, closing costs, and the amount you need to bring to closing. You must receive the Closing Disclosure at least three business days before you can close.

Review the disclosure carefully and ask any questions you may have. Confirm that all the information is accurate and matches what you expected.

6) Closing Day

Closing day is when ownership of the home officially transfers from the seller to you. At the closing, you will:

• Sign all necessary loan documents and legal paperwork
• Pay your down payment and closing costs
• Receive the keys to your new home

Crescent Title will work closely with you, your lender, and your real estate agent to ensure that all documents are prepared accurately and that the closing proceeds smoothly. Our team will be there to answer any last-minute questions and guide you through the final steps.