The Mortgage Process in 7 Steps: From Quote to Closing

Buying a home is an exciting journey, but the mortgage process can feel overwhelming, especially if it’s your first time. Breaking it down into manageable steps can make the experience less daunting and help you stay on track. Here’s a step-by-step guide to take you from that initial quote to closing on your new home.

1. Get Pre-Approved for Your Mortgage

Before you start house hunting, it’s crucial to get pre-approved for a mortgage. This step not only helps you understand how much home you can afford but also shows sellers you’re a serious buyer.

• Check Your Credit Score: A good credit score can help you secure better interest rates. Consider checking your credit report and addressing any issues before applying.
• Gather Financial Documents: You’ll need pay stubs, tax returns, bank statements, and proof of assets.
• Choose the Right Loan Type: Depending on your situation, you might consider a Conventional Loan, FHA Loan, or a VA Loan.

Ready to see how much you can afford? Use our Mortgage Affordability Calculator to get a better idea.

2. Get a Mortgage Quote

Once pre-approved, it’s time to shop for the best mortgage rates and terms. This can significantly impact your monthly payments and overall cost.

• Compare Rates: Different lenders offer different rates, so it’s smart to shop around.
• Request a Loan Estimate: This document outlines your loan terms, interest rate, estimated monthly payment, and closing costs.

3. Submit Your Mortgage Application

After choosing a lender, you’ll submit a full mortgage application. This includes:

• Providing personal and financial information
• Authorizing a credit check
• Submitting income verification documents

Need help finding the right lender? Get matched with a lender that fits your needs.

4. Underwriting and Loan Processing

Once you submit your application, the lender’s underwriting team will review your financials to ensure you meet the loan requirements.

• Document Verification: The underwriter will verify your income, assets, and debts.
• Appraisal Order: The lender will order an appraisal to determine the property’s value.
• Conditional Approval: You might receive a conditional approval that requires you to provide additional documents or explanations.

5. Home Appraisal and Inspection

Before final approval, the lender will require a home appraisal to confirm the property’s value.

• Appraisal: Ensures the home’s value matches the loan amount.
• Home Inspection: Not always required by the lender, but highly recommended for buyers to uncover potential issues.

6. Closing Disclosure and Final Walkthrough

As you approach the final stages, you’ll receive a Closing Disclosure (CD) outlining all the final loan terms and closing costs.

• Review Your CD: Verify the details carefully, as errors can delay your closing.
• Final Walkthrough: Inspect the home to ensure it’s in the agreed-upon condition.

Tip: Use our Loan Comparison Calculator to evaluate different loan options and pick the best one.

7. Closing Day – Sign and Get the Keys

You’re almost there! On closing day, you’ll sign a mountain of paperwork and pay your closing costs. Once complete, you’ll receive the keys to your new home.

• Sign Final Documents: This includes the mortgage note, deed of trust, and closing disclosure.
• Pay Closing Costs: Typically 2-5% of the purchase price.
• Receive the Keys: Congratulations, you’re officially a homeowner!

FAQs About the Mortgage Process

Read Next

• Buying Your First Home
• Conventional vs. FHA Loan: Which Is Better?
• 30-Year vs. 15-Year Mortgage – Which is Right for You?

Ready to take the next step? Start your homebuying journey today.