The Home Loan Process: A Step-by-Step Timeline for Buying a Home

Buying a home - whether it's your first or your fifth - is exciting, but the home loan process can feel overwhelming without a clear roadmap. From prequalification to closing, there are several important steps that happen behind the scenes.

Understanding how the home loan process works can reduce stress, help you avoid delays, and put you in a stronger position when making an offer. Below is a simple, step-by-step home loan process timeline to help you know exactly what to expect.

Step 1: Prequalifying for a Home Loan

Before contacting a real estate agent or touring homes, the first step in the home loan process is mortgage prequalification.

Prequalification allows a lender to review your basic financial information to estimate how much home you may be able to afford. While it's not a loan approval, it gives you a realistic budget and helps sellers view you as a serious buyer.

Why Prequalification Matters

In competitive markets, sellers often choose buyers who are already prequalified. If two offers are similar, the buyer who has started the mortgage process usually has a clear advantage.

Step 2: Making an Offer on a Home

Once you find a home you love, you'll submit an offer along with an earnest money deposit.

Step 3: Negotiating the Home Purchase

Negotiations are a normal part of the home buying process.

Step 4: Completing the Mortgage Application and Disclosures

With an accepted offer, you'll complete your full mortgage application. You'll also receive a Loan Estimate that outlines your interest rate, estimated monthly payment, closing costs, and prepaid items.

Even if you were prequalified or preapproved, the loan must go through underwriting for final approval. This portion of the mortgage approval process usually takes about three days.

Step 5: Home Appraisal

The lender orders a home appraisal to confirm the property's value supports the loan amount.

Step 6: Home Inspection and Final Price Negotiation

A home inspection identifies potential issues that weren't visible during your showing.

Step 7: Final Loan Approval and Closing Disclosure

Once approved, you'll receive a Closing Disclosure detailing your final loan terms.

Step 8: Closing on Your Home

At closing, you'll sign the final documents. Funds are typically disbursed within one to two days.

Work With the Right Mortgage Lender

Because the home loan process includes many moving parts, working with an experienced mortgage lender is essential.

*A prequalification is not an approval of credit and does not signify that underwriting requirements have been met.

**Preapproval is based on a preliminary review of credit information and is subject to full underwriting and appraisal.

y review of credit information and is subject to full underwriting and appraisal.