7. Obtain Mortgage

When you apply for a mortgage, what are some of the items that are needed? (These may vary depending on the lender.)

• Social Security cards and driver licenses
• Residence addresses for the past two to five years
• Your landlord's name and address
• Names and addresses of each employer (past two to five years)
• Your most recent pay stubs
• Two years signed tax returns and W2s
• Names, addresses, account numbers and balances of all checking, savings, credit cards and installment loans
• Two most recent bank statements on all accounts
• Information on any stocks or bonds you own
• Details of all real estate owned
• Copy of fully executed sales contract
• Divorce decree & child support agreements
• Application fee

You will receive a "good faith" estimate (or GFE) of the closing costs from the lender. It includes the costs for: points, appraisal, title search, title insurance, survey, recording of deeds, and points.

* At this time, there are several other items that may need to be done before the lender gives final approval to the mortgage title, even though the title company stated it was clear.

* Owner's Title Insurance - This covers you, the buyer, in the event that the title is not clear. This is usually optional, but recommended.

* Private Mortgage Insurance - Again, this is something that most lenders require if your down payment is less than 20 percent of the purchase price. It is a protection for the lender in case you default on the loan.

* Homeowner's Insurance - This is an insurance policy that covers the cost of repairing or rebuilding your home in the event of a natural disaster. Obviously, this is beneficial to both you and the lender. In a condo, a portion of your condo fee goes to the Master Insurance Policy. A separate homeowner's insurance is not needed for a condo, but it is recommended you buy condo insurance, which is similar to renter's insurance.

With the exception of the homeowner's insurance, all of the above costs, plus any additional ones such as the appraisal, survey and recording of deeds will be included in the GFE provided by the lender.

This means that you should count on having this much cash available besides the amount of your down payment and the amount of points paid to the lender. The down payment is usually a minimum of 3.5 percent to 10 percent of the selling price.

If your mortgage is approved, the lender will send you a letter of commitment. If the following information is not provided, you will request an exact accounting of the closing or settlement costs and the required documents that you will need to bring to the closing.