The 5 steps of the mortgage

Whether you're a seasoned property hunter or a novice looking for your first property, getting a home loan can be a challenging and exhausting experience. That's why we've put together this five-step guide to help you navigate the mortgage application process, from finding your ideal property to signing your contract of sale.

So, take out your finest pen and follow the guide to obtain the precious sesame that is the mortgage!

Step 1: the sales agreement

Before embarking on the signing of the sales agreement, it is important to fully understand the implications of this document.

Find the property:

The first step in the mortgage adventure is to find the property that makes your heart beat (and your wallet). Whether you are a pro at researching ad sites or whether you prefer to use a real estate agency, the important thing is to find the rare pearl that meets your criteria. And be careful, before you commit, don't forget to check that the price of your crush is compatible with your budget!

Sign the sales agreement

Once you have found the property, it's time to take out your finest pen to sign the sales agreement! This document is crucial because it formalizes the agreement between you and the seller for the sale of the coveted property. To obtain your mortgage, you will have to present this precious sesame to the bank. But before signing, take the time to carefully read all the clauses of the contract in order to avoid unpleasant surprises.

Step 2: Choose your bank

You may already have a regular bank, but do not hesitate to look at what other banking establishments offer.

Select your bank

Now that you have signed the sales agreement, it's time to put yourself in "bank hunter" mode to find the financial institution that will finance your real estate project. You can compare the offers of different banks to find the one that suits you best. Don't forget to put your negotiating skills into action to obtain the most advantageous rate and repayment terms for you.

Compile the loan application file

Have you chosen your bank? Great ! Now it's time to put together a concrete file for your mortgage application. To do this, you will need to collect important documents such as the sales agreement, an expert report if necessary, and your proof of income and professional stability. Remember that the stronger your file, the more likely you are to obtain the precious sesame that is the mortgage.

Step 3: bank agreement

After finding your rare pearl and choosing your bank, it's time to patiently wait for their decision on your mortgage application.

File review process:

The bank will dig into the details of your loan application file to assess your ability to repay. Response time varies depending on their review process, but generally you can expect a response within a few weeks. During this period, the bank may ask you for additional information or supporting documents to finalize their decision. Stay tuned to respond to all their requests and get your answer quickly!

Obtain the Preliminary Credit Offer:

The good news has fallen! The bank has accepted your mortgage application and you will receive the Preliminary Credit Offer. This offer is like a treasure map that contains all the information about the loan that the bank is ready to give you. Up to you ! You have 10 days to explore this offer in depth and decide if it suits your needs. If the terms offered are attractive, you can sign the offer and return the documents to the bank to complete the home loan loop.

Step 4: Finalize the mortgage

Congratulation ! You have validated the Preliminary Credit Offer and now it is time to finalize the process to obtain the funds necessary to purchase your property.

Signature of the credit agreement :

This contract is the cornerstone of your purchase transaction. It is important to carefully read all the terms and conditions of the loan before signing it. If you agree with the terms of the contract, you can sign and the bank can start working with the notary to finalize the transaction.

Delivery of the check equivalent to the amount borrowed :

Once everything is signed, sealed and delivered, the bank releases the loan funds and gives your notary a check for the amount borrowed. The notary gives the bank a mortgage registration commitment letter so that the bank can put a mortgage on your property as security for the loan. Then, the notary will take care of all the necessary steps to register the real estate transaction with the competent authorities.

Step 5: final sales contract

You are almost there! After obtaining the agreement of your bank and finalizing your mortgage, all that remains is to sign the final sales contract.

Verification of the sales contract

Before taking the notarial deed, don't forget to take a close look at the terms of the sales contract! Check that everything is in line with your expectations and that the property is the one you want to acquire. Moreover, a short visit before signing will not hurt to avoid unpleasant surprises.

Payment of notary fees

So here we are talking about costs that should not be forgotten! Notary fees represent on average between 7 and 8% of the purchase price of your property. It may seem high, but it is an essential step in the buying process. These costs include notary fees, taxes and registration fees. Remember to plan for these costs in your budget for the purchase of your property. And don't forget, the payment of notary fees is made when the final sales contract is signed!

In conclusion

Getting a home loan can seem like an uphill battle, but with a little patience and preparation, you can ensure a smooth and successful experience. Remember that each step is crucial to reaching your end goal, and industry professionals are there to help you every step of the way. So, arm yourself with your enthusiasm and your seriousness, and rush towards the realization of your real estate dream!

Salima Hamrini Editor and journalist specializing in real estate.

12 Jun 2023