Inspections
Home inspections are a important part of the home buying process. A solid home inspector will point out deficiencies in your future home. Even on a new home, an inspection report is over twenty pages long. It is important that buyers get an inspection AND be available after the inspection to discuss the findings with the inspector.
Other inspections needed is a wood destroying insect inspection (WDI). If needed there are also septic inspections, well inspections and water quality test.
Buyers can ask for repairs to be completed. We work together to present a repair amendment to the listing agent for requested repairs.
Lender Paperwork – Original Paperwork
Once you’re in contract your lender will require documentation to start the loan. The initial documents usually includes:
- Two years of income taxes
- Two years of W-2
- Three months of checking, savings, brokerage, retirement accounts
- Most recent 30 days of paystub(s)
- Copy of driver’s license
- Copy of social security card
Most lenders now have a portal in which you can securely upload your documentation. Depending upon your finances, the lender may require other initial documentation.
Appraisal
The appraiser is the person that values the home. Your lender will call a disinterested third party Appraisal Management Company. The Appraisal Management Company sends out the appraiser. The appraisal is usually ordered within the first 10 to 15 days of the contract. The buyer will pay for this upfront.
Although the buyer pays for the appraiser, he does not work for you. Federal law requires this independent appraiser report to an Appraisal Management Company. The final appraisal is reviewed by the Appraisal Management Company as well as the lender’s underwriter. These two entities are the appraiser’s customers. The appraiser’s customers are satisfied with an appraisal that meets value or are just $1k to $2k over value. Because of this, the majority of appraisals will either meet value or be either $1k to $2k over value.
More Lender Paperwork – Processing
Once your loan officer turns your file over to the loan processor, the loan processor will look in detail at the paperwork. The processor then will ask for more documentation as needed.
Underwriting
The lender’s underwriter is the person that approves the loan. They look over the loan paperwork in more detail than the loan processor.
More Lender Paperwork – Underwriting Request
The underwriter can request paperwork from buyer or clarification of items.
Loan Approval with Conditions
The underwriter approves the loan but with conditions. The conditions is usually more paperwork and clarification of items.
Clear to Close & Closing Disclosure
These are the words you’ve been waiting for!! A clear to close means all the underwriting conditions have been met. The file is now going to the closing department. The lender sends out a Closing Disclosure to the buyer This disclosure has to be sent to buyers three days before they close. The buyer has to acknowledge they received it three days before we close. Sometimes this original Closing Disclosure is not accurate. Lender and title will work together over the next few days to get a final closing disclosure to buyer.
Final Walk-Thru
Usually a day before closing we walk the property to ensure that the repairs have been done. I often tease that the final walk is to ensure the home hasn’t “blown up”.