Stages of buying a home with a mortgage loan

To purchase their own home, many households use financing with a mortgage loan from a bank. The lack of clear information or the presence of unclear information creates a basis for making mistakes in this process. Insufficient preparation and unfamiliarity with the process of applying for a mortgage loan can lead to the buyer losing money.

Due to the numerous conditions and peculiarities of the mortgage loan application procedure, some of the most common risks are that the borrower may not receive the desired loan amount due to a lower market valuation of the property or may end up losing the paid deposit. Another possibility is that the loan disbursement process may not be finalized according to the agreed deadlines in the preliminary purchase agreement. In this way, the buyer finds themselves in the position of the defaulting party, failing to fulfill their obligations towards the seller.

Avoiding any risks requires careful preparation and the use of the services of a competent real estate broker. A competent broker is able to properly manage the property purchase process and, if necessary, offer adequate measures to prevent the failure of the transaction and the loss of money for the buyer.

Stages of buying a house with a mortgage

For a successful purchase of a house with a mortgage, it is essential to follow the sequence of the following stages:

1. Determining the size of the loan based on the borrower/buyer’s income – obtaining pre-approval from the lending bank;

2. Finding the desired house;

3. Depositing for the house;

4. Determining the market price of the house by a licensed appraiser;

5. Bank’s assessment of the loan amount to be granted based on the borrower’s income and the appraiser’s determined market value of the house;

6. Signing a preliminary agreement for the purchase of the selected property.

7. Collecting and preparing all necessary documents for the bank from the borrower and the seller – ownership documents legitimizing the seller, current certificate of no encumbrances, sketch and plan of the property, current certificates of no tax obligations, marital status, and others, depending on the specific property;

8. Signing the loan agreement.

9. Notarizing the transaction.

10. Disbursement of the loan. This happens after providing a current certificate of no encumbrances to the bank, which shows that the borrower is the current owner of the property and has established a first-ranking mortgage in favor of the bank;

11. Taking possession.

Author: Stanimir Stankov / VIP Clients Manager, New Home 1 / tel.: 0894 555 690

Stanimir Stankov, Manager Nov Dom 1

Photos: Pinterest


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