Merrick Damon Real Estate

Unless you are a cash buyer, you will have to go through the necessary steps to obtain a mortgage before closing on your home. Understanding the process will make it more efficient and allow you to spend your time more wisely.

Mortgage Pre-Approval
Getting a mortgage pre-approval is the perfect way to start the home buying process. Most property owners in Sarasota demand that buyers viewing their house have Ythe ability to afford a purchase.  If you already have a lendor, contact them for their specific requirements.  If you need a lender The SRQ Duo can recommend a great  and trustworthy professional based on your specific situation. This process not only lets you know exactly what you can afford before you start shopping for your dream home, it also puts you in a stronger negotiating position with the sellers.  Typical items needed for the pre-approval:


  • Tax returns with all schedules for the most recent 2 years
  • W-2’s, 1099’s, for the most recent 2 years
  • 2 months of bank statements with all pages
  • Name and number of work contact and landlord
  • Most recent 30 days worth of paystubs
  • Most recent statement for investments (401K, IRA, etc.)
  • Any additional items that may apply (letters of explanation, divorce decree, child support etc.)

Make an Offer
Once you have found your dream home and you’re ready to make an offer, The SRQ Duo will guide you through the offer and negotiate the deal with the listing agent and seller. The purchase agreement is the contract between the buyer and seller stating the terms of the transaction.

Loan Application
The signed agreement becomes a legal binding contract and you must meet all conditions and timelines. At this point you must obtain the mortgage or cash to complete the transaction. Submitting a complete loan application is the best way to obtain the necessary mortgage funds in a timely manner. If you are already pre-approved, you are more than halfway home.

Inspection of the Property
Once an offer is accepted, an inspection of the property will be completed. The inspector will go through the property in detail to make sure everything is in good working condition and that



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there are no hidden defects. Don’t try to save money by skipping inspections. Have the home thoroughly inspected before you buy it.

Appraisal
Once a copy of the contract is received, a request for an appraisal is made, which estimates the value of the property being used as collateral for the mortgage. The appraiser is generally familiar with the area and has a good idea of what value and amenities are common. Armed with this information, the appraiser compares the sale prices to determine the value of the property. Typically, it takes an appraiser four to eight days to complete the appraisal . 

Title Insurance
In order to obtain financing on the property you are purchasing, it is standard to purchase title insurance for the mortgage. Title insurance is a policy to guarantee a free and clear title to the house or property. In order to secure a commitment for title insurance, a preliminary title report must be ordered to ensure that there are no “clouds” or problems with the title of the property that would hinder the transfer of title.

Verifications
To close on your property, verifications of employment, assets and debt are collected by your loan officer. From the information given at application, your loan officer will send out the various verifications to your banks that indicates your current balance, average balance for the previous two months, any outstanding loans, and any problems that you have had with your accounts. In addition, your loan officer will send out a verification of employment to your employer that states your gross base pay, overtime pay, commission income, bonus income, and the manner in which you are paid (hourly, weekly, monthly, etc.).

Credit Report
In order to submit your loan for final approval, a Credit Report must be ordered. Your credit is accessed from the three major repositories around the country – Experian, Trans Union, and Equifax. The information provided tells us of your ability to repay your obligations and it alerts us of any credit problems that we may have to take action to correct.

Closing
The final step is closing the deal. This typically takes place at an attorney’s office or title company.  When all the applicable paperwork has been signed, notarized, and recorded; the keys are handed over to you.  From the time the offer is accepted until the loan closes a normal timeline would be 30-45 days.  There are certain things you should not do during this process, including:


  • Make any large purchases (vehicles, jewelry, furniture)
  • Use credit cards excessively
  • Apply for additional debt, such as credit cards, car loans etc.
  • Do not co-sign a loan for anyone
  • Make any large deposits into checking/savings without discussing with your loan officer first
  • Do not have any late payments on bills
  • Do not have any overdrafts
  • Do not switch jobs without addressing with your loan officer first