Have you wondered what the mortgage loan pre-approval process looks like? While the loan process is similar across the mortgage industry, it will vary from lender to lender.
Since we often get asked about the Loan Process, we wanted to outline the general steps of Bluefire Mortgage Group’s loan pre-approval process.
The first step is to connect with the client, identify their mortgage loan needs, and gather a preliminary loan application. This allows us to get to know the goals/timeframes (along with other information), provide a rate quote, and the borrower an opportunity to ask questions.
Gathering a complete loan application upfront allows for a thorough loan analysis with the Mortgage Loan Originator and an accurate rate quote. We typically schedule a meeting or phone call, once the application has been completed.
During this meeting, we briefly review the application while notating any important details that may need to be clarified. We then proceed to compile the list of financial documents that the client needs to provide and send a request for these documents via a secure email link.
Once the client uploads these documents, we begin an initial review of the file. This review typically consists of the following steps:
- Review of employment/qualifying income
- Review of asset verification
- Review of any other real estate owned
- A credit check for the qualifying borrowers
While we typically reserve running credit reports toward the end of our pre-approval process, we do occasionally run them first if there are any suspected issues. We always confirm permission from the client to run credit prior to any action being taken.
Once our initial file review is done we then complete a final review. This final review serves to ensure all aspects of the loan application are completed/correct. We run through a list of items that could cause any potential issues or red flags with the final review to ensure nothing stands out.
At this stage, we also determine which loan program appears to be best suited for the borrower based on the overall loan profile (ie 30 30-year fixed vs. Adjustable Rate Mortgage, etc). Depending on the loan program and the strength of the file part of this final review includes a complete and automated underwriting system assessment.
After our final review is complete, we then put together a pre-approval email for our clients. This Pre-Approval letter gets sent to the client and outlines all of the details/terms of the qualifying mortgage. We also connect with and share relevant details with the buyer’s realtors.
Overall the pre-approval process is formulaic – Similar to completing a puzzle where all pieces eventually fall into place. This process may seem tedious, but it allows assurances on the closing timeframes, expectations, and the ability to negotiate terms and conditions with sellers.
