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Chapter Eleven

    After the home inspection, you should contact your lender to keep the process in forward motion. At this time, you can give the okay for the bank to send out an appraiser.  The appraiser will contact the listing broker and meet with him at the property to conduct his evaluation.

    The bank appraiser is independent of the bank, the realtors and anyone else involved in the process. Most appraisers are linked into the Multiple Listing Service which gives them the ability to look at all of the comparable sales for the area.  

    To become a certified appraiser you must take the required classes, pass the state exam and also serve a two-year apprenticeship under an already established appraiser.   The requirements to become certified have become stringent since a great deal is riding on the appraiser's opinion and valuation of properties. 

    The appraiser will use the comparable sales, much as we used them, to decide on a price.  Based on  training, experience and knowledge of the market, he or she will arrive at a value and deliver the report to your lender.  The property must appraise for the price that you are paying for it or close enough to justify your loan.  The bank will notify you of the results as soon as they are available.

    If you have not already done so, you must now actually apply for your loan. One of the important dates in the home buying process is the loan commitment date. You will want to keep in touch with your loan officer to make certain that the loan is done by this date. Your broker will also stay in touch with the loan officer to help this process along.

Loan Commitment

   The loan commitment is a formal document from the bank or lending institution which states that your loan has been approved for the purchase of the particular property that you are buying.  This is over and above the pre-approval and is a loan that is "ready-to-go".  In order to arrive at this point, your loan application has had to go into underwriting and the property you are buying has been appraised by a professional appraiser.  The appraiser has usually been sent out by the bank to the property for appraisal prior to this point.  Depending on the the lending institution, the commitment  is usually several pages long and contains all of the information about your loan including the rate, finance charges, amount financed, length of the loan and any outstanding contingencies.  

   Your loan commitment must be ready by the financing date agreed to in your purchase and sale agreement.  If, for any reason, your bank needs additional time to have this document ready, you must get in touch with your attorney, broker or the seller and ask for an extension.