Time spent on the loan process depends on a number of things. First, it depends on how long it takes you to find a property in California you want to call home. If you consider that search as part of the process, you should expect it to take months or possibly years. When it comes to choosing a house, you want to be thorough. Always consider factors like the style of the house, the size, its location, the state of the neighborhood, the quality of schools, if you have children, community amenities, and anything else you consider important or relevant to the process such as travel time to and from work or shopping.
Second, how fast you can secure a mortgage in California depends on how long it takes the lender or broker to handle things on their end. Once you’ve chosen a place, you should also research the different mortgage lenders available to you. Compare price quotes from multiple companies, and consider down-payments and loan sizes. You want to do business with trusted professionals who will assist in finding the lowest housing rates.
You may also want to get pre-qualified. This is sort of like getting pre-approved, but it gives lenders a quick feel for your finances, and it gives you an idea of what you can afford. Getting pre-qualified usually takes three days. Getting pre-approved, on the other hand, can take 7 to 60 days. This process can be complicated and lengthened by factors such as investment properties, bankruptcy, or divorce.
A pre-approval letter is best described as a preliminary “screening” for a candidate looking to purchase a home in California. It is not a loan commitment. A home appraisal is required before a commitment can be issued along with verification of income, assets, taxes, and insurance. The pre-approval process is simple, and you need to provide the following information to obtain one:
- Authorization to pull credit
- Applicants full name(s)
- Contact numbers and email address
- Social Security Number
- Date of Birth
- Current address (do you currently rent or own?)
- Income (gross)
- Assets (liquid and non-liquid)
- Any other real estate owned
- If you currently own, do you intend to sell prior to or simultaneous to a purchase?
- Estimated purchase price of new home (condo or single family? Where?)
- Amount of cash you plan to put down (indicate where funds are coming from i.e., savings, gift, proceeds from sale of current home)
- Estimated taxes and insurance costs on the new purchase property
- Once this information has been collected, a pre-approval letter can be generated and issued, and it is good for 90 days from the date of issuance.
And finally, the length of time needed to approve your loan application is also going to factor into how quickly you can expect to receive your mortgage in California. The length of the application process depends on how organized you are with your personal information. You’ll need to provide prospective lenders with proof of income and employment, a list of assets, credit reports, details concerning the property you want to buy, personal identification, and other information. With all required documents on hand, filling out the actual application should only take a couple hours at the most.
The actual loan approval process can typically take anywhere between four and forty days. This happens after you’ve made an official offer on a property, and rests on how organized you and your lender are. Being well organized can expedite the loan process. Have all required documentation ready whenever it’s needed, and provide it where it’s needed in a timely manner. Unfortunately, you don’t have total control over the speed of the entire process, but being efficient with your responsibilities supports the process. Facilitate constant, clear communication between you, the lender, and the seller. Catch and resolve any little snags before they become big problems. Do your research beforehand to avoid surprises or unexpected complications. In short, be prepared.
Golden State Mortgage Can Help
At Golden State Mortgage, we are a California based mortgage company, and specialize in FHA home loans for first time home buyers. FHA loans are a great option for first time home buyers and if this is your first home purchase then a California FHA home loans are probably your best option due to the low down payment and easier credit standards. Your down payment can be as low as 3.5% of the purchase price, and closing costs and fees can be covered by the seller. Call Lone Star Financing today at 1-800-585-6886 or fill out the quick contact form to speak with a California FHA loan consultant and get a free good faith estimate.