How Long Does It Take to Get a Loan?

Follow these steps to land the smartest loan.

Step 1: Shopping for loans

You wouldn't buy a car, furniture, or appliances without shopping around, would you? So you shouldn't sign up for a 30-year loan without doing your research.The Fair Isaac Corporation, or FICO, allows people to rate-shop for a mortgage without repeatedly "dinging" their credit scores. However, do all of your shopping within a 14-day window for credit bureaus to ignore subsequent "dings" every time you pull your credit.

Step 2: Get a pre-qualification letter

Most sellers require your pre-qualification letter before they'll even consider your offer --this step is quick and easy. Ask the lenders you spoke to during your mortgage shopping for a pre-qualification letter. These are relatively easy to get and they give a rough, unverified estimate of the loan size you may qualify for. Most lenders will give you a pre-qualification based on your verbal self-reporting of your income, assets, debts, and down payment size.

Step 3: Get pre-approval

The pre-approval stage is when lenders verify everything you've told them. You'll need to supply proof of income, proof of assets, proof of employment, records of any debts you hold, and of course identification documents and a credit report. Depending on your situation the process can take anywhere from weeks to months. Once you're pre-approved, you'll receive a conditional letter stating the exact amount of loan for which you're approved.

Step 4: Final loan approval

Armed with your pre-approval letter, you make an offer on your dream home and it's accepted. Next, you'll need the lender to conduct an appraisal. An appraisal is official verification that you're buying the home at a reasonable market value. Scheduling a time for a licensed appraiser to visit the property is frequently the longest part, and may take up to two weeks. Once the appraiser makes a home visit, the approval (or rejection) comes through within a day or two.

Now that you've passed the appraisal process, you're ready to close on this loan -- and a house.

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