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Getting a Home Loan in California: Steps in the Mortgage Process

What is the process for getting a home loan in California? What steps are involved? Where do I even begin?

These are some of the most common questions among home buyers and mortgage shoppers in California. This article will help you prepare for the mortgage process by understanding the various steps that occur between application and closing.

9 Steps to Getting a Home Loan in California

We’ve taken the California mortgage process and broken it down into a series of steps, to help you understand it. While every lending scenario is different, most borrowers will go through the following steps when getting a home loan in California:

1. Saving Your Money

You will likely encounter some out-of-pocket expenses when using a mortgage loan to buy a home. There’s the down payment for one, and this could range from 3% to 20% of the purchase price (unless you’re using a VA loan). There are also various closing costs and fees you might encounter along the way. You can improve your chance for success by starting to save right now.

2. Creating a Budget

It’s wise to have a monthly housing budget in mind, before you start looking at homes or applying for loans. This will ensure that you don’t exceed your financial comfort zone when taking on a mortgage loan. Here’s an article that walks you through the budgeting process in detail.

3. Getting Pre-Approved for a Loan

This is the next logical step in the California mortgage process. Pre-approval is when a lender reviews your financial situation to determine how much you’re qualified to borrow. There are benefits to getting pre-approved for a home loan in California. Among other things, it will make sellers more inclined to accept your offer. Learn more about getting pre-approved.

4. Submitting a Loan Application

The mortgage application is another required step when getting a home loan in California. Most lenders use a standardized form for this purpose. It’s called the Uniform Residential Loan Application, also known as Fannie Mae form 1003. You can view a sample application online, in PDF format, to get a feel for what it includes. Learn more about the mortgage application process.

5. Gathering Your Documents

Getting a home loan in California requires documents. Lots and lots of documents. During the application and pre-approval process, you will be asked to provide w-2 forms, tax returns, bank statements, pay stubs, and other documents relating to your finances. Mortgage lenders use these documents to verify your income, assets and debts.

6. Shopping for a Home

Once you have a budget and a pre-approval amount, you can shop confidently within that price range. This prevents you from wasting time looking at homes that exceed your budget. There is a logical sequence of events when getting a home loan in California. It makes sense to get pre-approved first, so you can narrow down the market to homes that fall within your price range.

7. Mortgage Underwriting

The mortgage underwriter will analyze all aspects of the home loan to ensure it meets the lender’s requirements and any secondary program requirements (such as FHA, Freddie Mac, etc.). They also evaluate the level of risk associated with the loan. This is an important step in the California mortgage process, because it can determine whether or not you will move forward to closing.

8. Resolving Any “Conditions” That Arise

If the underwriter identifies one or more issues that must be resolved, you might receive what’s known as a conditional approval. This means you must resolve these conditions to keep the process moving forward. A common example is a letter of explanation for a recent bank deposit or withdrawal. The underwriter requests the letter, the borrower provides it, and then the loan moves forward. Some borrowers clear the underwriting process with no additional requests or conditions. Other borrowers receive one or more requests. Like many steps in the California mortgage process, it varies from one transaction to the next.

9. Closing the Deal

When the underwriter is satisfied with all aspects of the loan, the borrower is said to be “clear to close.” This means the loan can be funded and the deal can be closed (after a lot of signatures, of course). Closing is the last step in the process when getting a home loan in California.

Learn more: This article focuses on the mortgage process in particular, which is just one aspect of the broader home-buying process. We’ve created a related guide that breaks down the home buying process into 11 steps.

We Can Help You

Bridgepoint Funding is a full-service mortgage company based in Walnut Creek, California. We’ve been helping California home buyers for more than 15 years. We offer a wide variety of loan products, including FHA, VA and conventional.

If you’re in the market for a mortgage loan, but you’re not sure where to begin, please contact a member of our staff. We can help you with many of the steps outlined above, including choosing the right type of loan for your situation. We can even give you a no-obligation rate quote based on your financial situation.

How to reach us: Please call us at (925) 478-8630 to get started. You can also email us at We look forward to hearing from you!

Mike Trejo is a Bay Area mortgage broker with 20+ years of knowledge and experience.

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