If you are shopping for new homes in the Greater New Bedford area, it is important to understand ahead of time what to expect when you apply for a home loan at your local credit union. This article is being written to serve as a basic guide to help first time home buyers or credit union members who are applying for a home loan with their New Bedford credit union for the first time. Knowing all of the steps that are involved in applying for a home loan can help take the guesswork and worry out of the loan application process.
Step One – Choose the Type of Mortgage You Need
The type of mortgage loan that you will need when you apply for a home loan at your New Bedford credit union will be determined by a couple of factors. The amount of money that you will want to spend on your new home will of course determine the payment amount and the number of months or years you will be paying on your loan. The amount of money that you have to put down on the home will also affect the type of mortgage loan that you will need. Other standard factors, such as your monthly income, your total debt, your credit rating and the amount of money that you can afford to pay each month on your mortgage, will also come into consideration.
TIP: Consider getting a pre-approval for a home loan, especially if you are first time home buyers, before you go shopping for a new house. When you find the home that you want to purchase, the pre-approval letter that you receive as credit union members will let the sellers know that you are serious about your intent to buy.
Step Two – Filling Out the Application
When credit union members fill out the application for a home loan at their local New Bedford credit union, they should expect to answer questions about themselves, their finances and of course the property that they are hoping to purchase. With regard to the member, they should be prepared to answer basic personal information and provide details about where they work and how much they earn. Credit union members should also be prepared to provide information about the source of funds for closing costs, down payment and other associated costs and fees. Pre-approval loans should include an approximate amount of how much money will be spent.
TIP: Contact your customer service representative at your credit union to find out what information and documents you will need to bring in to complete your application. You can schedule an appointment to apply for a home loan to help save time and first time home buyers can use this opportunity to ask questions about mortgage loans before applying.
Step Three – Processing the Loan
When you meet the representative at your New Bedford credit union, you will be speaking with a mortgage expert that can answer all of your questions. This is the person that you will speak with if you need help throughout the process. Once you apply for a home loan and submit your request, it will immediately be processed. Your representative will contact you with important information regarding your mortgage loan application so you can review the documents and keep them for your records.
TIP: While you are in the middle of a loan process, do not make any changes to your personal or financial situation that could affect your approval. Do not change jobs, do not make major purchases and do not shift your money from one financial institution to another – leave your deposits in the same account until the new mortgage loan has closed.
Step Four – Loan Approval
After you receive a pre-approval letter from your New Bedford credit union, the final decision of the actual mortgage loan will occur when you choose a house and the property can be reviewed. At this time your loan application, the specific amount of the loan, as well as any debts and assets will be reviewed for final approval. Once your mortgage loan receives final approval, the loan can be prepared for closing.
TIP: Stay in communication with your loan representative at your local credit union throughout the process. Don’t be afraid to ask questions or get more details if you are unsure about anything at this time.
Step Five – Closing Documents
Your New Bedford credit union will prepare all of the loan documents for you. Title insurance is a necessary requirement of purchasing or refinancing a home. The title insurance policy is used to confirm the legal status of your property and is also used to prepare the final documents for your closing process. As your representative about setting up escrow for payment of homeowners insurance and real estate property taxes. Setting up homeowners insurance is a requirement of the closing process, so you will need to provide all of the related information about your homeowners insurance policy to your credit union representative before the closing date.
TIP: Buying a new home can be a stressful situation, especially if you are a first time home buyer. Your New Bedford credit union representative will walk you through the process, help you apply for a home loan and lead you through the documentation, signing and closing process to ensure that everything goes smoothly. Contact your representative at any time during this process if you have any questions or concerns.
About St. Anne Credit Union
St. Anne Credit Union serves members throughout the Bristol and Plymouth Counties of Southeastern Massachusetts. It is a member-owned, non-profit financial institution. Established in 1911, this New Bedford credit union currently serves over 3,00 members and has over $18,000,000 in assets. St. Anne Credit Union is the oldest credit union in Southeastern Massachusetts.