A Step-by-Step Guide to the Loan Process

The financing process associated with buying a home can be overwhelming. Understanding each step of the process can alleviate confusion and stress, and make the loan approval process much less daunting.

The Loan Approval Process step-by-step graphic.


Although not a necessary step to the loan approval process, pre-qualification can help you to decide your budget as you begin looking for a home. By providing a lender basic financial information, they are able to give you figures for a mortgage for which you could potentially qualify.


While pre-qualification gives you a general idea of the amount of mortgage you could potentially take on, pre-approval actually provides a conditional commitment for a loan. In this step, you provide the lender with more detailed financial information and a completed mortgage application. From this, the lender gives specific loan options with a breakdown including details about interest rates, closing costs and timeframe.

While not required, pre-approval is helpful when looking to buy a home, and when you are ready to make an offer. Having a pre-approval from a lender oftentimes makes your offer stronger in the eyes of the seller, as it eliminates potential risks later in the buying-selling process. Pre-approval also can help you to lock in a specific mortgage rate.

But because pre-approvals are only good for a limited time, you may want to hold off if you are in the early stages of the buying process that you expect to take longer than a few months. Finally, be aware that while lenders typically honor the general terms of a pre-approval, they are not guaranteed.

Securing your loan

Once you’ve selected a property and have a contract with the seller, the next step is to complete your loan application.

  • If you have not already done so, or the approval time has lapsed for your pre-approval, you will need to provide your lender with all necessary financial documents.
  • After your initial meeting, the lender will order documents, including credit reports, property appraisal, employment verification, and a preliminary title report.
  • The lender will assemble the loan package and provide it to the underwriter for approval.
  • Lender receives the ordered documents and will request additional information, if necessary, and address any issues.
  • Parties are notified of approval.
  • Final loan documents are prepared and sent to the title company, and borrowers come in for final signatures.
  • The funds are transferred by wire for the transaction.
  • The title company records the deed of trust at the county’s recorder’s office and the escrow is officially closed.

At Priority Mortgage, we believe that it should be easy to find a loan that suits your lifestyle and saves you money. If you need assistance, a mortgage expert who can answer questions is just a phone call away. For more information about the mortgage process or to get started, contact us today.