Intent to Proceed: More Than Just Moving Forward with a Loan Application

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Expressing an “intent to proceed” is another critical step in the home buying process that you need to decide after shopping and getting pre-approved by a few mortgage lenders. In simple terms, intending to proceed means that you’ve finally chosen a lender who you think offers you the most competitive rates. As a first-time homebuyer, there are things that you need to understand if you plan to proceed with your application with a particular lender because this will be the first time a lender will start charging you fees, other than a credit report fee.

Intending to proceed initiates your transaction with a lender

Potential lenders will give you Loan Estimates to give you a clear picture of the interest rates and other costs that you’ll need to pay for the amount you plan to borrow. Upon receiving Loan Estimates, homebuyers are advised to review the lenders’ respective requirements on how to proceed with the loan application. It’s important to note that signing a Loan Estimate doesn’t mean that you’re intending to proceed. There are several ways you can express your intent to proceed with a lender. If you can’t go to the lender’s office and express your intention to proceed in person, you can communicate it over the phone, through email, or by submitting a signed pre-printed form. For recordkeeping purposes, the lender must document your intention to proceed to officially move forward with your application.

Because mortgage interest rates vary almost every day, lenders will give you up to 10 business days to think if you’re going to consider their offer. Silence or no response within the given time frame means you’re not interested in the offer.

You will need to send a new application and likely get an unfavorable interest rate as compared to the first if you fail to express your intention to proceed with a lender with your prior application.

Fees and full documentation start to kick in once you intend to proceed

Your lender will immediately require you to pay an appraisal and loan processing fees. This is also the time that you’re going to provide complete documentation to support your financial information including assets and all your sources of income for the lender to decide if they’ll approve your loan or not. Lenders are not required to charge fees unless you express your intention to proceed with your application.

Before intending to proceed, it’s important that you have all your necessary and updated financial documentation on hand so you can give it right away to the lender you choose so you can immediately move forward to closing. If you fail to satisfy all the documentation requirements, the lender will delay your closing and you could risk losing your deposit funds and dream home.

Final thoughts about intending to proceed

Expressing an intent to proceed is a formal way of notifying a lender that you want to move forward with your mortgage application. As a homebuyer, it’s important that you notify the lender of your intention to proceed within the given time frame, pay the fees, and provide all necessary documentation to avoid costly risks. If everything goes well after you intend to proceed with your application, you’re now on your way to the closing to fulfill your dream as a homeowner!

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