Step 1. Complete a mortgage application
An application for a mortgage is even easier to do than ever before. If you are comfortable giving personal information over the phone, you can talk to a lender from your own home and they can help you with the application. If you would rather do the application face to face, you can choose to meet with the lender at their office or at a neutral place such as a café or coffee house.
Step 2. Inquire about different mortgage options
The lender can inform you about the various options you will have in a mortgage. Your situation is unique and a lender should take the time to get to know you and then provide a recommendation on the type of loan that will best fit. They should structure the loan in a way so that you save the most money. A good Nashville lender will provide mortgage options with a good faith estimate, meaning that they’ll provide numbers for you as accurately as possible so you can assess each one and how it best meets your needs.
Step 3: Get a good faith estimate (important!)
If you don’t get a good faith estimate from the lender, ask for one. It’s such an important step and you should never lock in a rate without one. It’s the best way to avoid surprises down the road and avoid spending thousands of dollars more than you should. Extra fees and unplanned costs could pop up during closing that might have been avoided with a good faith estimate.
Step 4. With a good faith estimate, review mortgage rates and closing costs
Keep in mind that interest rates can vary, but you should never pay too much for your mortgage rate. Check on the good faith estimate to ensure that you will not have to pay an origination fee or discount points (unless buying a rate down). The good faith estimate should also never contain closing costs that are more than 1 percent of the home’s purchase price. Usually, closing costs are less than that for Nashville homes that are already existing (rather than new construction).
Step 5: Tell your Nashville mortgage lender to lock in a mortgage rate
When the good faith estimate has been thoroughly examined and you’ve selected the best type of loan for you, make sure that the lender locks in a rate. They should send you documentation of that rate for your records.
Step 6. Gather all documents your lender requests
Now for the paperwork…ask for a specific list of documents from the lender and then gather them as quickly as possible. You should mail, fax or deliver the documents as soon as you can to keep the loan process moving forward and eliminate the possibility of costly mistakes.
Step 7. Ask the lender to inform you about the appraisal
You should keep on top of the appraisal process and know when it is being done. Your lender should also send you a copy of the appraisal report for your records. Since the appraisal is part of the cost, you have a right to the information.
Step 8. Ask the lender to fax your HUD settlement statement at least 24 hours before closing.
Ask your lender for a copy of the settlement statement. It’s important for you to review this document before attending the loan closing, as it will tell you what your costs are and also the amount you’ll need for closing. It’s one of the most important documents in a home mortgage loan and you should get plenty of time to review it. If you want the expertise and advice of your real estate agent, give them a chance to review it with you.
Step 9. Request that your Nashville lender be present at your closing
The lender should always be present at the closing, so make sure you ask ahead of time that a representative will be attending. Whether it’s your first home or your fifth home, the lender should always be present to address any questions or concerns.
Step 10. Get a copy of your lender's business card
Even when it’s over, its not over and you will likely need to contact your lending agent at some point. You might think of questions later on or need clarification on some point. Just because the papers are signed, doesn’t mean the lender shouldn’t be available for you. They should take care of your financial needs before, during and after the mortgage loan process.
Here are some excellent tools for you to use as you get more familiar with the mortgage loan process. There is a presentation of the Florida mortgage industry with a discussion on the laws and other special issues on this page. There is an informative mortgage forum at this site, where others can ask and answer the same questions you might have. Finally, this site is a wonderful resource for those wanting to get appropriate answers from knowledgeable mortgage mentors.