The Loan Process

In most cases a borrower applying for a Texas mortgage loan will need some patience. Very often it can take three weeks to a month to complete a Texas home loan application process to reach the closing date. Every transaction for a Texas mortgage loan is different than every other transaction, and can involve verifications of income and assets, verification of rent, title commitments, appraisals, bank underwriting, attorney or closer reviews, and a survey if needed, so that the loan package being examined is fully visible.

Every aspect of the borrower’s Texas home loan has to fit the parameters that the wholesale mortgage bank requires. For example, the title for the property must be free and clear when transferred to the new owner acquiring a Texas mortgage loan to purchase or refinance, the property itself must be approvable by the Texas mortgage bank for the type of loan applied for, the independent appraisal report must support the value needed for the mortgage loan applied for and comparable sales in the report must fit in the mortgage bank guidelines, the applicant must provide the particular documents required by Texas Mortgage Line, a survey either existing or new must be provided to show no encroachments on the property. These processes take time in most cases, and again patience is recommended.

To begin the process for a Texas mortgage loan, the applicant contacts a texasmortgageline associate for a pre-qualification. We will consult with the applicant regarding the type of Texas mortgage they wish to apply for, whether a purchase, refinance, Texas cashout or equity loan, the type of property, the income, assets and credit history will be discussed to begin with. We then will take a preliminary application and with the applicant’s permission, will run a credit report. With that information we can usually offer a pre-qualification based on that information, and possibly a pre-approval if we are able to determine this at that point. It is best then to send us by fax or email, paystubs, W-2’s, and asset accounts so that we at Texas Mortgage Line can then offer a pre-approval after review. At this point we can send the applicant or their realtor, a pre-approval form which they will need for a purchase mortgage loan, and the applicant can begin looking for a home to purchase, or make an offer on a home. For a refinance we at texasmortgage line begin processing the new loan.

Once the applicant has made an offer on a home that they are interested in purchasing, and after negotiating with the seller to reach a basic agreement, there will be a contract executed between the buyer and the seller, and will usually include an “earnest money deposit” and an “option fee”, the contract will allow for 7-14 days for the buyer to have the property inspected by licensed inspectors to determine any problematic issues with the house that may need to be negotiated with the seller, or the chance to back out of the contract and still have the deposit refunded to them during the option period. After the contract is executed, usually the listing agent will “open title” at a title company of their choice. The title company will review all recorded documents pertaining to the property, and their attorneys will oversee a draft of the title commitment for the new transaction, along with other documents needed to close the Texas home mortgage loan. The “closing” will be held at this title company where the actual contractual obligations are signed. All other documentation gathered and signed by the prospective buyer are preliminary up to that point.

Texas Mortgage line will then order the appraisal for the property and is in most cases a fee to the borrower. The appraisal is an independent company that will view the home, measure it, take pictures of the property and the comparable properties in the area which have been sold fairly recently, which will determine the value. This report can take from 1-7 days usually, however, we can have the borrowers file in underwriting for review and send the appraisal in when completed. Also during this time, texasmortgage line and the borrower can be searching for homeowners insurance for the property.

Once the file is underwritten and approved, the mortgage bank may require additional documentation or verification, which must be provided, and usually can be, and this can take several more days to acquire, submit and reviewed by underwriters. Once all conditions have been met, the file will be reviewed by attorneys, which can take another 1-2 days. They will send all the closing documents to the title company who will generate the settlement statement that is basically a balance sheet or ledger of debits and credits for the transaction down to the penny. Title companies prefer to have the settlement statement prepared the day before the closing.

The closing itself usually takes about an hour, and after signing the note and the deed of trust, the applicant has become a Texas mortgage loan borrower, and is the owner of the home.

Real Estate, the best investment!

Lee Penn | Texas Mortgage Line | 281.701.1655