Steps in the Mortgage Process When Buying a Home in Washington State

The process of getting a mortgage consists of several stages and typically takes anywhere from 30–45 days — sometimes more — depending on how prepared you are, what mortgage program you’ve selected, and if it’s a purchase, the agreed-to closing date on the purchase and sale agreement. It’s not unusual to close in two weeks for a pre-underwritten buyer, assuming the appraisal can be completed in time.

The steps below may not take place in the exact order listed, and some steps may happen simultaneously.

Prequalification

The prequalification stage may consist of obtaining rate quotes from various lenders and providing basic information about your home buying scenario — verbally or electronically. This is probably the most ideal time to shop for your lender if you haven’t already made your selection.

You can start the prequalification or preapproval process as soon as you begin thinking about buying a home. I often help buyers who are 12 months away from being ready — people who want time to plan, work on savings, or improve their credit.

Preapproval

During the preapproval stage, you’ll need to provide documentation that proves your income, assets, and funds for closing. Your credit report will also be pulled. Your application is updated based on the documentation provided, and your loan officer will help you finalize your preferred mortgage program. Depending on the program, your file will then be run through an automated underwriting system (AUS).

If your loan is preapproved, you should receive a preapproval letter. If it’s not, your lender should give you clear guidance on what needs to improve — typically credit, income, or assets — to reach preapproved status.

Preapproval letters need to be updated periodically as credit reports and supporting documents expire. Once you’re preapproved, unplug your shredder — you’ll need to keep all your documents handy.

You may also need an updated preapproval letter customized for the specific home you’re making an offer on. Check in with your loan officer before making any offer so they can provide an updated letter and rate quote. They’ll need to know the property taxes, the amount you’re planning to offer, and your intended closing date.

Some buyers opt for a pre-underwritten preapproval — where an actual underwriter reviews and approves the file before you even make an offer. This is the strongest form of preapproval available and gives sellers the highest confidence that your financing will close.

Making an Offer

Your real estate broker will present the purchase and sale agreement based on the terms of the mortgage you’re preapproved for — another reason to have your preapproval updated before making an offer. The preapproval letter is often included with the offer.

If you have any vacations or travel planned before closing, let your real estate agent and loan officer know before submitting the offer.

It’s not unusual for listing agents to call your loan officer to review the preapproval. Sometimes, with my client’s permission, I’ll reach out to the listing agent proactively to introduce myself — it can help buyers win in multiple-offer situations.

Mutual Acceptance

Once you have a signed purchase and sale agreement, a complete copy needs to be provided to your lender right away. This is what officially kicks off the processing stage.

Processing

Once your lender has the purchase and sale agreement (or you’ve decided to proceed with a refinance), processing begins. Your loan processor works closely with your loan officer to prepare the file for underwriting. During this stage, title insurance and escrow are ordered. The processor will review and update the application and request any additional documentation needed.

If anything changes during processing — employment, assets, or credit — contact your loan officer immediately.

Initial Disclosures

After your lender receives the purchase and sale agreement or has a complete application, you’ll receive your initial loan documents. This package includes your Intent to Proceed and Loan Estimate (LE), along with other required disclosures. Review, sign, and return these promptly — delays here ripple through the entire timeline.

Locking Your Rate

Depending on your closing date and market conditions, you may or may not want to lock in your rate right away. Some borrowers choose to float — meaning they don’t lock — hoping rates will improve before closing. Your rate must be locked before an underwriter can issue final loan approval.

Once you lock, you may receive additional documents including a revised Loan Estimate reflecting the locked rate.

Homeowners Insurance

You’ll need to provide your lender with contact information for your homeowners insurance provider. The lender will request a binder directly. Get this done as soon as possible — the insurance premium is factored into your monthly payment, and delays here can hold up closing.

Appraisal

For a purchase, the appraisal is typically ordered after the home inspection has been completed and the results are satisfactory. When the lender receives the appraisal, underwriting reviews it and then provides a copy to the borrower.

If the appraisal comes in below the sales price, you’ll review options with your real estate broker and loan officer. The lender bases the loan-to-value on the lower of the sales price or appraised value. If the loan amount or terms change as a result, you’ll receive revised disclosures.

Appraisers sometimes flag items that need to be addressed before closing — common ones in Washington State include missing carbon monoxide detectors and missing earthquake straps on water heaters. If the appraiser calls for a repair or re-inspection (sometimes called a 442), that needs to be resolved before the loan can close.

Underwriting

Once processing has a complete application with all supporting documents, the file goes to underwriting. The underwriter reviews the application, documentation, and lender guidelines, then issues one of the following:

• Conditional approval — approved, subject to satisfying a list of conditions
• Suspension — more information needed before a decision can be made
• Denial — the loan does not meet guidelines

Most approvals are conditional. Conditions fall into two categories:

• Prior to Doc (PTD) — items that must be resolved before loan documents can be prepared
• Prior to Funding (PTF) — items that must be resolved before the loan can fund (close)

Common conditions include documenting the source of a large deposit, providing a letter of explanation for employment history, submitting updated pay stubs, or providing missing pages of a bank statement.

Satisfying Conditions

The processor and loan officer will work on obtaining everything the underwriter requested — which often means you’ll be hearing from us with a list of additional items needed. This is completely normal, and yes, it can feel repetitive. The mortgage process is redundant by design — there’s no way to sugar coat it. The good news is that by this point, you’re almost done.

Once conditions are satisfied, the file goes back to underwriting for review. If everything is in order, final approval is issued. Sometimes additional items are required — this continues until the underwriter is satisfied and issues a clear to close.

Important: If there are any changes to the contract — seller credits, sales price, closing date — let your loan officer know immediately. Do not assume your real estate broker has already told us. Any contract changes, or any planned travel before closing, need to be relayed to your loan officer as soon as possible, as they can directly impact the closing date and when the Closing Disclosure can be issued.

Final Approval

Final approval means all prior-to-doc conditions have been met. There may still be prior-to-funding conditions remaining — but at this point, loan documents can be prepared. This is a very good moment.

Closing Disclosure

Once final loan approval is issued, the Closing Disclosure (CD) is prepared and sent to all borrowers. The CD starts a mandatory three-business-day waiting period before you can sign your final loan documents with the escrow company.

It is critical that you sign and return the Closing Disclosure to your lender as soon as possible — the three-day clock does not start until your lender has evidence of when you signed. This waiting period cannot be waived and has the potential to delay closing if the CD isn’t executed promptly.

Loan Documents

After the lender receives the signed Closing Disclosure from all borrowers, loan documents are prepared and delivered to the escrow company. Escrow typically waits until they have received the documents before scheduling your signing appointment.

Signing

Plan on your signing appointment taking at least an hour — possibly longer depending on how many questions you have. Signing typically takes place one to two days before closing. While signing and closing can happen on the same day, it’s best practice in Washington State to sign a day or two before funding to allow time for wires, recording deadlines, and any last-minute items.

Final Document Review and Re-Verification

After you’ve signed, the escrow company sends the documents to the lender for review and to the county recorder’s office for recording. Just prior to funding, the lender re-verifies your employment to confirm nothing has changed, and a soft credit pull is done to confirm no new accounts or large purchases have been made since closing.

If there have been changes to your employment or credit, the transaction may be delayed while underwriting reviews the new information. This is why it’s so important to keep your financial profile consistent from preapproval through closing.

Funding and Recording

Once employment and credit have been re-verified, the lender contacts escrow to balance funds — making sure everything on the Closing Disclosure is accurate to the penny. Once balanced, the lender wires funds to escrow and provides recording instructions.

Recording takes place at the county courthouse where your home is located. The vesting deed and deed of trust are recorded and become public record. Fair warning: once your home records, expect a surge of junk mail.

Closing

Once your transaction has funded and recorded, you are officially closed. Keys, please.

Now that wasn’t so bad, was it?

If you’re buying a home in Washington State and want to work with someone who will walk you through every step of this process clearly and without surprises, I’d love to help.

Have more questions about the mortgage process? Visit my Frequently Asked Mortgage Questions page.

Let’s Talk

Rhonda Porter is a Licensed Mortgage Advisor (NMLS #121324), serving home buyers throughout Washington State.