"You can't get a close done in 30 days" I've been told. This statement has been made to me time and again from some of my friends at some of the larger bank owned mortgage companies. I want to share some quick tips that can help move things along smoothly and eliminate heartburn at the closing for your clients, real estate partners and you.
I know that getting a loan done in 30 days or less can sometimes be a daunting task. There are many factors to consider as to why the lending process can get bogged down. I'm a mortgage lender in Tucson Arizona and thus have been in one of the five or so states with the highest numbers of foreclosures and short sales. Those aren't normally 30 day transactions are they? Although Tucson suffers from the same ailments troubling many other cities it's not hard to speed up the process on the loans that are not shorts and REO's.
These steps may seem redundant but like anything else worthwhile in life, repetition becomes practice.
1. Take a complete and I mean complete application. Get phone numbers, addresses, two year work and residence histories, REO section complete, child support etc.
2. Documentation: If you have been an LO for a while, you know what you need, GET IT FROM THE BORROWER. When in doubt get it anyway. In this market of extreme documentation, get what you know you will need, don't push it off till down the line. That's when problems can happen.
2. Make note of any special circumstances as soon as you know about them. Don't pass it off and hope your processor will catch them. Handle them up front.
3. Develop an excellent rapport with your clients. Be up front with them and let them know that through the process we will most likely need a few items that may not be known up front and that you'll let them know as soon as you know what else is needed.
4. Inform your Realtor partners when you see red flags on a file up front at the pre-qual. This is not a popular one because some of our agents don't like to know the details, they just want it done. Truth is times have changed and if your agents are like that, you can get in some hot water by trying to please them, leaving the details out then getting that one condition that bites you near closing. Your agent would have rather known before that moment I can assure you. Point out the problems.
5. Make it easier for your underwriter to get comfortable with your file. Supply all your explanations that you know you will need, derog credit, job gap, credit inquiries, special job circumstances, special pay circumstances, etc. as fast as you can. Whether a mortgage broker or banker, underwriters like complete files. The more complete on their first look the more likely they are to give you a favorable decision assuming your file merits one.
The Realtors I work with know that I am a little cautious. Maybe that's not a good thing to some but at the end of the day I only work with agents that understand that I can't just plow a loan through with wreck-less practices, be a yes man and cross my fingers that my 579 score borrower with the 5 jobs in two years, an 8 month job gap in between, a gift for down and $5 in the bank is a no brain er. We gotta talk!
With tighter practices we can still close loans in 14 days to 30 days for clean complete files. More is required of us than ever before but the end game is completing what is asked in the most timely way possible for our clients, referal partners and ultimately us.
Good Luck out there,
For information on how I can help your buyers or sellers contact me:
Michael A. Rohde
SR. Loan Officer
Sunstreet Mortgage LLC