How to Get A Mortgage

In this step, the Buyer/Borrower applies for a mortgage, gets a pre-approval from a Lender/Bank and looks for houses.

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In this part of the mortgage process, the Buyer/Borrower finds a house and puts an offer in. If this offer is accepted by the Seller, the contract is signed. Then, the Buyer/Borrower works with their Lender to get a Commitment Letter/Mortgage Commitment from the Lender. 

As soon as the Seller's attorney receives the signed contract, the Seller's attorney gathers the existing Title Work, and sends it out to be brought up to date from when their clients (the current owners) originally purchased the property. 

Once the updates to the Title Work come back, the Seller's attorney:

• Reviews and drafts the proposed Transfer Documents that would be needed at closing, and
• Sends the Title Package to the Buyer's attorney

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The Buyer's Attorney will review the Title Package, and either:

1. Send to the Bank Attorney to be reviewed and have the Title Company write the Title Report/Title Policy/Title Commitment (referred to as "writing title"), or
2. Write the Title Report/Policy themselves and then send everything to Paragon Home Loans for Legal Review.

The Title Report/Policy/Commitment provides a summary of the chain of title, outstanding liens, taxes, and a list of clear items called Title Exceptions/Title Curatives that need to be addressed either prior to, during or after closing depending on the item. 

Once the Bank Attorney sees that all the exceptions have been met and have all the documents needed to close, it is Legal Cleared. 

During this process, the Bank is working on getting their file Bank Cleared.

When the file is both Bank Cleared and Legal Cleared, then a closing is scheduled between the three parties (Buyers, Sellers, Bank / their attorneys).

After closing, all the Transfer Documents get recorded with the County Clerk, the closing package goes to the Bank, and each party should have signed copies of all documents. 

In this step, the Title Company reviews all the scanned documents from closing to be sure that Paragon Home Loans receives the Proofs needed to Clear the Exceptions previously raised. 

Once the Title Company has all the Proofs and have received the recording, then a Final Title Policy is issued to either the Lender or the Buyer along with an update to the original Abstract, known as a Final Abstract Continuation. 

- Commitment Letter:

Letter issued by the Lender stating they will give a Mortgage to that Borrower to purchase that property but lets them know what else is required to “Bank Clear” the file.

<< Back to Step Two

- Bank Cleared:

When the Lender approves the borrower to get a mortgage for that certain property.

>> Back to Step Eight

- Legal Cleared:

When the Title work and purposed documents match what the Lender needs and address all exceptions that were raised in the title report.

*File must be Bank Cleared AND Legal Cleared in order to schedule the closing.*

>> Back to Step Seven

- Title Package:

*Each package varies by Attorney and Transaction, this is a general list*

• Abstract:Original document (more like a packet) of the chain of title, usually dated 70 years back to a warranty deed, showing each transaction for that property and the people who have owned it, through hopefully the last month or so.

>> Back to Step 12

• Tax Search and Bills: We can do one without the other in some cases, as long as we have proof of what taxes have and have not been paid, the current amounts and how to pay them in the future. This is for “setting up escrow”, which is when Bank includes the taxes in the mortgage payment so the buyer’s don’t’ have to pay it separately on their own.
• Purposed Deed / Affidavits / Any Documents that may be needed to address something found in title:
  • *Ex. Power of Attorneys, Trusts, Certificates of Death, Judgment Affidavits, Survey Affidavits, Name Affidavits etc.
    *Sometimes judgements or name discrepancies are addressed in the Seller’s Certification Affidavit/ Seller’s All Inclusive Affidavit/ Owner/Seller’s Affidavit/ Closing Affidavits (Everyone seems to have a different name and format for this form)
• Contract and Commitment Letter: It is ok if the Commitment Letter isn’t included, it may have not been issued yet.
• Survey: updated or existing if they have it. Up to the Lender whether an updated survey is required.

>> Back to Step Four

- Title Report/Policy/Commitment:

This is what the Insurance Company that is “writing title” creates after thoroughly reviewing the Title Package and raising what items, known as Title Exceptions or Curatives, need to be addressed. This is sent to the Buyer’s Attorney so he can take care of anything that needs to be done for closing.
>> Back to Step Five
>> Back to Step Six

- Transfer Documents:

These are the documents that are required at Closing, most of them to be recorded in order to officially transfer title from the Sellers to the Buyers. Some of these are included in the Title Package that is sent, some of them are not. Depends on the Attorney sending and if they know what we do and don’t need to review.

*In order to record a Deed, the State and County Tax Forms, RP 5217 and TP 584 must be recorded with it. Sometimes there are exceptions and other forms, but those are situational.

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>> Back to Step Four
>> Back to Step 10

- Proofs:

Are any signed documents that clear the exceptions in the Title Report. Typically used when referring to documents after the closing took place.

>> Back to Step 11