First-Time Buyer Playbook: From Pre-Approval to Clear-to-Close

Buying your first home is exciting—and overwhelming. From getting pre-approved to handling underwriting conditions to finally getting your keys, here's your step-by-step playbook for navigating the entire home buying process without surprises.

Quick Summary

• Pre-approval first: Get pre-approved before house hunting to know your budget and strengthen your offers
• Underwriting timeline: Typically 30–45 days from contract to closing; can be faster with good documentation
• Common conditions: Appraisal, income verification, asset documentation, title issues
• Clear-to-close: Final approval step; you'll get closing disclosure 3 days before closing
• Closing day: Sign documents, get keys, start making memories

Step 1: Pre-Approval (Before House Hunting)

Why Pre-Approval Matters

• Know your budget: Understand exactly how much you can afford
• Stronger offers: Sellers prefer pre-approved buyers
• Faster process: Most of your documentation is already reviewed
• Avoid disappointment: Don't fall in love with a house you can't afford

What You'll Need

• Income documents: Last 2 years W-2s, last 30 days pay stubs, tax returns
• Asset statements: Last 2 months bank statements, investment accounts
• Credit check: Lender pulls your credit (soft pull for pre-approval)
• Employment verification: Lender confirms your job and income

Pre-Approval vs. Pre-Qualification

• Pre-qualification: Quick estimate based on what you tell the lender (not verified)
• Pre-approval: Lender verifies your income, assets, and credit (much stronger)

Always get pre-approved, not just pre-qualified. It shows sellers you're serious and can close.

Step 2: House Hunting & Making an Offer

Working with Your Real Estate Agent

• Get an agent: Buyer's agent is typically free (seller pays commission)
• Share your pre-approval: Agent can help you target the right price range
• Be ready to move fast: In competitive markets, homes sell quickly

Making a Competitive Offer

• Price: Offer at or above asking if market is hot
• Earnest money: Shows you're serious (typically 1–3% of purchase price)
• Contingencies: Inspection, appraisal, financing (standard protections)
• Timeline: Shorter closing timelines can make your offer more attractive

Offer Accepted: What's Next?

Once your offer is accepted:

1. Earnest money deposited: Goes into escrow (refundable if contingencies aren't met)
2. Home inspection: Typically 7–10 days to complete and negotiate repairs
3. Loan application finalized: Lender starts full underwriting process
4. Appraisal ordered: Lender orders appraisal to verify property value

Step 3: Underwriting Process (30–45 Days)

Week 1: Initial Review

• File to underwriting: Loan processor submits your complete file
• Initial conditions: Underwriter requests additional documentation
• Common requests: Updated pay stubs, bank statements, explanations for large deposits

Week 2–3: Conditions & Documentation

• Respond quickly: Faster you provide docs, faster you close
• Common conditions:
  • Income: Updated pay stubs, employment verification
  • Assets: Source of funds, bank statements, gift letters (if applicable)
  • Credit: Explanations for credit inquiries, collections, or late payments
  • Property: Appraisal, title work, homeowners insurance

Week 4: Appraisal & Final Review

• Appraisal ordered: Lender orders appraisal (takes 1–2 weeks)
• Appraisal review: Underwriter reviews appraisal to ensure value supports loan
• Low appraisal: If appraisal comes in low, you may need to renegotiate price or bring more cash

Week 4–5: Clear-to-Close

• Final approval: Underwriter approves loan with all conditions met
• Closing disclosure: You'll receive final closing costs 3 days before closing
• Review carefully: Compare to your loan estimate; ask questions if anything changed

Step 4: Common Underwriting Conditions

Income Verification

• Pay stubs: Most recent 30 days
• W-2s: Last 2 years
• Tax returns: Last 2 years (if self-employed or have rental income)
• Employment letter: Verification of employment and income

Pro tip: If you're changing jobs, wait until after closing if possible. Job changes can delay or derail loans.

Asset Documentation

• Bank statements: Last 2 months for all accounts
• Large deposits: Any deposit >50% of monthly income needs explanation
• Gift funds: Gift letter required if using gift money for down payment
• Investment accounts: Statements showing retirement, stocks, etc.

Common issue: Large, unexplained deposits raise red flags. Document the source (sale of car, tax refund, etc.).

Credit Conditions

• Credit inquiries: Explain any recent credit applications
• Collections: May need to pay off or provide explanation
• Late payments: Explanation letter if you have recent late payments
• Debt payoffs: Proof of payoff for debts you're closing

Property Conditions

• Appraisal: Must appraise for purchase price (or higher)
• Title issues: Any liens or title problems must be resolved
• Homeowners insurance: Proof of insurance required before closing
• Repairs: Any required repairs from inspection must be completed

Step 5: Clear-to-Close & Closing Day

Clear-to-Close (CTC)

• Final approval: All conditions met, loan is approved
• Closing disclosure: Sent 3 business days before closing (TRID requirement)
• Review costs: Compare to original loan estimate; verify nothing unexpected
• Wire instructions: Get wiring instructions for closing funds (don't use email—call to verify)

Closing Day Checklist

• Bring ID: Government-issued photo ID (driver's license or passport)
• Closing funds: Certified check or wire transfer (confirm amount with title company)
• Homeowners insurance: Proof of insurance policy
• Questions: Ask any last-minute questions before signing

What Happens at Closing

1. Sign documents: Loan documents, title documents, disclosures (30–60 minutes)
2. Fund loan: Lender wires funds to title company
3. Record deed: Title company records new deed with county
4. Get keys: Once recorded, you get keys to your new home!

Timeline: Typically 1–2 hours at closing, then 1–2 hours for recording before you get keys.

Common Timeline Delays

• Slow documentation: Taking too long to provide requested documents
• Appraisal delays: Appraiser scheduling or property access issues
• Title issues: Liens, easements, or other title problems
• Last-minute changes: Job changes, large purchases, new credit applications
• Repair negotiations: Disputes over inspection repairs

How to avoid: Respond to requests within 24 hours, don't make major financial changes during the process, work with experienced real estate and lending professionals.

What To Do Next

1. Get pre-approved — Start the process before house hunting to know your budget
2. Gather documents early — Have W-2s, tax returns, bank statements ready
3. Respond quickly — Faster you provide documentation, faster you close
4. Talk with Harry — Get personalized guidance through your first home purchase

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Quick FAQ

How long does the mortgage process take?

Typically 30–45 days from contract acceptance to closing. Can be faster (21–30 days) with good documentation and no issues, or longer (45–60 days) if there are complications.

What if the appraisal comes in low?

You have options: (1) Negotiate price down with seller, (2) Bring additional cash to cover the difference, (3) Walk away if you have an appraisal contingency. Your agent can help negotiate.

Can I buy furniture or a car before closing?

No. Don't make large purchases, open new credit, or change jobs during the loan process. These can affect your debt-to-income ratio, credit score, or employment status and can delay or kill your loan.

What's the difference between pre-approval and final approval?

Pre-approval is based on initial review of your income, assets, and credit. Final approval (clear-to-close) happens after full underwriting, appraisal, and all conditions are met. Pre-approval is strong but not a guarantee.

When do I get my keys?

Typically 1–2 hours after closing, once the deed is recorded with the county. The title company will notify you when recording is complete and you can pick up keys.

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Educational only; not a commitment to lend. Qualification and terms subject to credit, income, collateral, and underwriting approval. Equal Housing Lender. Rockhouse Mortgage, LLC. NMLS #2469785.