The next step in the home loan process, after the loan packaging stage has been completed, is “Loan Setup”. The loan setup team orders third party items and prepares the mortgage file for processing.
The loan setup process takes 2 to 3 business days. During this time, a loan professional orders third party documents. Examples of third party items are: the appraisal, the title policy, your homeowners insurance, IRS tax transcripts, employment verification(s), etc..
The Mortgage Mark Team is still your primary contact! Most of time you won’t communicate with the loan setup professional. However, if they have any trouble getting documentation and need your help, they will reach out to you.
The professional will contact your employer for a Verification of Employment (VOE). They will also reach out to your Insurance Agent for a declaration page. Again, if they need your help with something they will reach out to you.
Action Required From You
First and foremost, you will need to submit any overdue supporting documents. Aside from that, during the loan setup stage you must do two things. You need to finalize your homeowners insurance and pay for the appraisal immediately.
Homeowners Insurance: Finalize It
Please finalize your homeowners insurance right away (if you have not done so already). We need the insurance declarations page to confirm your annual premium and coverage amounts. Insurance impacts the prepaids section of the closing cost, so we need accurate premium amounts when we submit the file to underwriting.
Appraisal: Payment Needed
The loan setup team orders your appraisal and then emails you a link for payment. Please submit payment ASAP. The costs typically ranges from $500 to $650 depending on the loan program, occupancy type, and the property location. Check out our appraisal page for a full breakdown what you need to know about appraisals.
Pay ASAP Unless…
There is one exception when you shouldn’t pay for the appraisal immediately. Wait to pay if you are buying a home and negotiating with the seller for repairs or seller concessions. We recommend waiting for finalized negotiations to pay. You don’t want to lose leverage with the sellers if the Appraiser inspects the home during those negotiations. This shows that you will keep moving forward, no matter the negotiation outcome.
The appraisal usually takes about one week from the date that it has been ordered AND paid for. Hence, why we stress paying for it quickly. We will forward you a copy of the appraisal once we receive it.
Next Step: Processing
After the Setup stage is processing where the file is submitted to one of our Processors on the Mortgage Mark Team. The Processor works alongside the Underwriter, the Closer, and the Title Company to approve and close your loan.