Explaining the FHA Mortgage Process

The FHA mortgage process is straightforward. It is composed of basically three main steps: processing, approval, and closing. The total FHA mortgage process from preparation to closing can take 30 to 60 days. Taking the necessary preparation steps can help shorten the amount of time it takes to close the loan. Also, knowing the FHA guidelines can help speed things along. The most important key is to find the right lender and loan officer to help you through the process of homeownership.


The first step in this process is to prepare by reviewing the FHA guidelines and make sure you qualify for an FHA insured loan. Review your financial situation by analyzing your credit report, your savings and your current assets and liabilities. Also note your sources of income, your current and potential income amounts and any future planned purchases.

You can use online calculators to determine your monthly qualification amount. After you have reviewed your financial situation and determined how much of a monthly mortgage you can afford, then you can work with a real estate agent and find the home you want to buy. The lender will typically require that you provide the following list of items in order to process your loan:

  • Paystubs
  • W-2s or Tax Returns for two years
  • Bank statements
  • Social Security card
  • Valid Picture Identification

Once the lender receives your items, they will verify your employment, bank assets and all credit liabilities. They will also order information on the property, called an appraisal report, to establish the appropriate value and risk.


An underwriter will review your loan application to verify that your income will support the requested loan amount. They will also check to make sure the property is within fair market value and that it matches the loan amount requested. The underwriter determines eligibility and determines FHA eligibility. Ultimately, final loan approval is up to the underwriter of the loan.


Once all information is verified and you agree on the terms and conditions of the loan that the underwriter has approved, a closing is scheduled. During the closing, a third party is present to witness the signing of the documents. You may incur certain closing costs depending on the terms outlined by your loan agent. The third party should review all fees, costs and collect all monies from you to close transaction. The closing agent works with both you and the seller to coordinate legal and monetary transfers.

Once your loan is closed, you be provided with the keys to your new home by your real estate agent or seller. Depending on what your contract stipulates, your keys may be provided for immediately or there may be a 2 to 3 day lag time.

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