Step 4. Begin loan processing
Although lenders conform to standards set by government authorities, loan approval guidelines vary depending on the terms of each loan. In general, approval is based on two factors: your ability and willingness to repay the loan and the value of the property.
Your loan processor will verify all of the information you have given. This information includes:
Is your income sufficient to cover monthly payments? Industry guidelines are used to evaluate your income and your debts.
What is your ability to repay debts when due? Your credit report is reviewed to determine the type and terms of previous loans.
Do you have the funds necessary to complete the purchase and pay closing costs?
Is there sufficient value in the property? The property is appraised to evaluate physical condition and location.
In some cases, additional documentation might be required before making a final determination regarding your loan approval.
>Step 5. Close your loan