Taking out a mortgage on a home doesn’t have to be overwhelming. We’re happy to guide you through the process, breaking down each step so you begin your next story with confidence.
Make sure these items are in good order:
- Your Credit History: Good credit may help you qualify for better interest rates. We’ll use your credit history to see how long you’ve been borrowing, if you paid your bills on time, and if you’ve taken on new credit lately.
- Gross Income: We’ll look at your paystubs and tax returns to see if you can make the monthly payments.
- Debts: Your debt-to-income ratio lets us confirm your debt isn’t greater than your income.
- Assets: List your assets, like checking, savings, stocks, retirement, and real estate to show us assets and available funds for closing.
Pro tip: Make sure you have enough money set aside for the down payment and closing costs –– and still be comfortable to pay your new monthly mortgage payments.
Now, we recommend starting the home buying process with Canvas Mortgage by prequalifying.
We will help you understand exactly how much house you can afford. Our team will also help you understand down payment options, loan amount, interest rates, and what your monthly payments might look like. This will place you in the best position of making a strong offer as everyone involved understands you’ve secured financing.
Once you find a home, your realtor will assist in making an offer and writing up a contract. From there, you’ll follow a few more steps to become “under contract.”
- Pay Earnest Money – Typically, you will need to submit earnest money –– which is money paid upfront to confirm you’re serious. This is included with the purchase contract. These funds will need to be verified.
- Schedule a Home Inspection – After the contract has been accepted by the seller, it’s common –– and recommended –– for the buyer to schedule home inspection.
- Complete Additional Paperwork / Disclosures – You’ll sign paperwork/disclosures and provide proof of employment, income, assets, and residence history. We will provide a loan estimate that breaks down the closing costs and down payment requirements.
Once you are under contract on your home, the following pieces are typically finalized:
- Lender Will Order and Have the Home Appraised – An appraisal is an expert opinion of value. All appraisals must be ordered by the bank and are specific to your property. Appraisals are used to determine a home’s value based on similar properties that have sold in the last 12 months or so.
- Lender Will Require a Title Search – Searches confirm ownership of the property. An attorney or their abstractor visits the county courthouse and searches the title for the past 33 years. They will confirm ownership has been passed correctly each time the property has been sold and the title has no issues.
- Secure Homeowners Insurance – You will need to purchase a homeowners insurance policy with coverage that begins on the closing date.
- Realtors Typically Schedule all Required Inspections – Pest inspections are typically completed within 7 to 10 days from the closing date to confirm the property does not have any active infestation, previous infestation, previous treatment, or visible damage. You may also be requested to obtain a septic tank or well inspection.
The final step of the homebuying process is the closing (also called a settlement). This is a meeting where you sign your final paperwork for the purchase of your home. The closing is held at the Title Company or Attorney’s office who completed the Title work. You will receive a CD (closing disclosure) at least three days prior to closing.
If your loan requires a down payment or closing costs, you’ll bring them to the closing. Be sure to ask your Realtor or Title Company which type of payment is accepted. For example, they may accept only certified checks.
On the closing date, the ownership of the property is transferred to you. In most cases, you’ll be handed the keys to your new home, and you can officially move in!
Visit our parent company, Merchants & Marine Bank.