How to make the loan process a positive one

Purchasing a home is an exhilarating event that marks a major milestone in life, but such a large investment can seem intimidating at first, especially when it comes to navigating the loan process. However, with the right preparation and partnerships, even first-time homebuyers can have a simple and rewarding mortgage experience. In this blog, we’ll explore eight mortgage tips to make the loan process a positive one:

1. Get pre-approved before shopping for a home
2. Gather your documents in advance
3. Be transparent with your loan officer
4. Take advantage of down payment assistance programs
5. Set a realistic budget
6. Hire a local real estate agent
7. Choose a tech-savvy lender
8. Keep in touch with your loan officer

If you feel uneasy about the homebuying process, you’re not alone–according to a 2024 survey, 91% of homebuyers are at least somewhat stressed about buying a home this year. But here’s a tip: partnering with a trusted mortgage lender and getting pre-approved before house hunting can significantly reduce this worry.

To get on the right track from day-one, look for a lender with a variety of loan programs, who is transparent, communicative and supportive. And be sure to approach this important business relationship with honesty and a sense of curiosity.

Having all the necessary documents, such as proof of income, tax returns, bank statements and credit reports, readily available allows for a more efficient review and approval process. This helps avoid last-minute scrambles to get information, ensuring the loan process moves along without delay. Also, being organized and proactive can potentially speed up approvals and make the experience more pleasant.

When you meet with a loan officer, they’ll evaluate you for a home loan by reviewing your finances, including your income, employment history, credit score and current debt. They’ll determine your ability to repay a mortgage and let you know the maximum amount you’re pre-approved to borrow. Plus, your loan officer should:

• Help you understand your credit report and explain how to address any concerns or errors. According to a recent report, about 10 million people have credit report errors that cause credit denials or higher interest rates.
• Provide valuable mortgage tips to maintain your financial stability throughout the process
• Suggest loan programs to fit your unique needs, from conventional to FHA to VA and USDA financing options, and more.

DPAs offer qualified homebuyers loans and grants to cover the down payment and/or closing costs. Many homebuyers find these programs confusing; in fact, a recent study showed that 53% of prospective buyers are not confident in their understanding of homebuying grant programs.

Not to worry! A local loan officer, like those at Guild, have expertise in the available programs in your area and can help match you with perfect DPA if you qualify, bringing homeownership within reach.

The amount you’re preapproved for and how much you can afford are two different figures influenced by many factors. Beyond your pre- approval amount, your lender should help you make an informed decision about the amount that is sustainable for you by calculating your eligible income, determining your debt-to-income ratio, estimating your closing costs and identifying your down payment options. Plus, you should get help factoring in expenses beyond your mortgage, such as property taxes, potential HOA and maintenance fees.

This financial blueprint will help keep your dreams within reach and prevent overspending.

After you have your pre-approval and a realistic home budget—but before you apply for a mortgage — you’re ready to start the fun part: your home search.

A well-connected Guild loan officer can refer you to top real estate agents with a proven track record in your target area. Here’s what you should expect:

• Constant communication: In a recent survey, 73% of homebuyers said they most value an agent who personally calls with updates.
• Access to hidden gems: A great agent leverages their professional network to find exclusive listings beyond those on popular online portals.
• The inside scoop: You should get valuable neighborhood insights into the schools, parks, shopping and other local amenities. Plus, expect to review price trends and market conditions of each neighborhood you tour.
• Help avoiding common mistakes: Their guidance should ensure you don’t overpay or overlook important details.
• Advice on making competitive offers: They know how to align an offer with the current market conditions as well as the seller’s expectations.
• Skillful negotiating: The best agents help you get a fair price and establish contingencies to protect your interests.

Once your offer is made and accepted, and a purchase agreement is signed, you may make an earnest money deposit to show your intent to purchase. Then it’s time to explore loan programs and apply for your mortgage.

Getting your mortgage in process immediately after your offer is accepted and the agreement is signed should ensure enough time for approval before the closing date. With digital mortgage tools at their disposal, the most competent loan officer can:

Of course, the best high-tech mortgage experience features plenty of one-on-one touch points as well. After all, technology shouldn’t replace your loan officer; it should empower them to deliver the best loan process possible.

From the initial consultation to closing and beyond, a mortgage expert at Guild can provide you with the continuous guidance you deserve. They’ll help you understand the loan process, keep you informed at every step, explain your refinance options, utilize high-tech tools and ensure all your questions are answered. For a no-obligation mortgage consultation, reach out to a Guild loan officer today.