Getting Your Loan Approved
Approval means that you have successfully qualified for the loan for which you applied. Having an approved loan application means you can begin the closing process on the house. You will receive a formal letter of approval, commonly called a commitment letter, from the lender that guarantees in writing that they will lend you a specific loan amount. It also details the conditions of the loan.
The letter will address:
- The loan amount
- Loan program and type
- Term of loan (How many years you have to pay back the money)
- Annual interest rate
- Loan origination fee
- Points that may be applicable to the loan
- How long you have to complete the closing-related activities and transactions
- Other costs (neighborhood association dues, special assessments, etc.)