Get pre-qualified by a mortgage specialist
This will give you an idea of the dollar value of the purchase for which you can get approved and the payments you can afford.
Choose a realtor with whom you want to work. Make sure to find an agent familiar with the area where you're planning on purchasing; the agent will have a better idea of proper expectations and realistic prices. And the realtor services are free for the buyers.
Negotiate your offer. It’s not only the price you need to negotiate: Other factors to negotiate may include closing (move -in) time or certain items, such as chandeliers, brand name washer and dryer, etc.
Normally purchase offer includes a requirement of 5 business days to get mortgage approval (and technical inspection, if needed).
You will be asked to provide a security deposit with your offer.
Get a formal approval now
If you were pre-approved – then it may be less stressful for you to get formal approval.
Don’t forget, that you can continue negotiations after the technical inspection. In a case where costly deficiencies are discovered by a Home Inspector, you can ask the seller to fix these issues or reduce the price.
If your financing (and technical inspection) are satisfactory to you - then your deposit will be considered as part of your down payment, and your offer to buy is now final.
If you are unable to get approval for the mortgage you need – then your deposit will be returned to you for the same amount.
The approval always comes with conditions.
Now it’s time to work out the remaining conditions on your mortgage approval.
A property appraisal is one of the conditions where the buyer is making 20% down payment or more. It certifies to the lender that they are lending the money on the property which was bought at fair market price.
An appraisal is ordered by a mortgage specialist and is performed by an anonymous service to avoid any influence from the buyer or seller on the appraisal value.
Other conditions may include income confirmation, 90 days history of down payment verification, etc.
That is why we suggest that all necessary documents are prepared before you shop for a property. The lender will be able to see these documents in the first days, when your application is received.
The lender may want you to pay off some debts or to close some credit cards.
All these conditions have to be fulfilled at least 10 business days before the closing.
Lawyer receives instructions from the lender.
When all conditions are removed, the lender instructs your lawyer for a mortgage advance. Schedule an appointment with your lawyer for the documents signing.
Fire Insurance. Please be aware that if you are taking a mortgage, you are obliged to get Fire Insurance on the mortgaged property. The insurance company will need to know the name and address of your mortgage lender. Your lawyer will need an insurance confirmation to close the deal.
Closing date
Your mortgage lender will send the money you were approved for to your lawyer.
Remember the deposit you gave with your offer? Now, you will have to visit your lawyer and bring the remainder of your down payment. Then, you will get the keys to your new home.
Mortgage payments will be taken directly from your bank account, usually one month after the closing, unless you choose a different payment scenario, such as weekly or bi-weekly.