Application

• The first step in the mortgage process is the mortgage application. The loan officer needs several hours or an entire day to review the application and take into account the borrower's income, debt and credit. Upon review of this information, the lender will issue a preapproval letter. This letter provides an overview of a buyer's affordability on a mortgage, but is subject to verification with the loan underwriting department.
  
  

Underwriting

• Once a loan officer collects all of the required income documentations that verify the stated amounts on the loan application, this information is sent to the underwriting department where it will be reviewed for approval. This process can take as little as three days or as long as two weeks. The time it takes will depend on the amount of files an underwriting department currently has under review, as well as the ability to easily verify the income documents. The more simple the verification, the faster the underwriting approval.
  
  

Appraisal

• Once the approval has been issued by the underwriting department, the appraisal of the property is ordered. The appraisal can take up to 10 days to complete.
  
  The appraisal is an independent valuation of the property that is sent to underwriting to validate that the property is worth the total amount of the mortgage that the bank has been asked to issue.
  
  

Locking the Rate

• Once the application has been processed, and the underwriting approval is issued, the fastest step in the mortgage process is then completed: locking in an interest rate, which means that the buyer has selected an APR for the loan and that the rate is now fixed and final on the loan application.
  
  

Clearing Conditions

• After the rate has been locked, the appraisal reviewed and the initial underwriting approval processed, the borrower is then asked to provide all of the documentation initially required to process the first underwriting approval. The underwriting department will verify that income and credit haven't changed during the time between the first approval and the upcoming closing date. The underwriting department will then issue conditions for closing. Once these have been met, the closing is scheduled.
  
  

Closing

• The loan is not finalized until all parties sign off on the closing documentation. Closing appointments will last from one to three hours; upon completion, the closing documentation is sent to the lender. The lender reviews the closing documentation and issues funding for the borrower's loan to the mortgage company within 24 to 48 hours. Once funding is complete, the mortgage process is concluded and the borrower will then begin making monthly payments.