• Your lender will order an appraisal The appraisal is very important because it is used to determine how much the property is worth, not the sales price. The appraisal is usually performed by a third party professional, not the lender, and there is a fee for this service. You may be asked to pay the appraiser directly, or the cost may be included in your closing costs. By law, you are entitled to a copy of the appraiser’s report.
• Your lender will evaluate your credit report. Your credit report is a detailed look at how regularly you have paid your obligations over time. There is also a credit score on the report the lender will use to make a decision whether or not to grant you a loan.
• Your lender will verify your employment and your bank accounts. The lender needs to determine that you are employed how and where you claim, and that your bank balances are consistent with the information on your loan application. Your W-2 and pay stubs are necessary for this step, and the lender may have you authorize them to inquire directly with a verification of employment form (VOE) and a verification of deposits form (VOD). You will need names and addresses of banks and people at your place of employment where these forms can be sent.