Procrastinate: to defer action; delay: to wait until an opportunity is lost. Well, that pretty much sums it up.
What does the underwriter do? They are responsible for determining if the risk of offering a mortgage loan to a particular borrower under certain parameters acceptable. It is always up to the underwriter to make the final decision on whether to approve or decline a loan. Seems like an important job, right? So why do they not bother to look at a file until the day before closing to make the decision to approve or decline?
When a transaction is delayed or falls through moments before closing, it is not going to be the agents, sellers or buyers fault. It most likely will be because the UNDERWRITER has procrastinated and not reviewed the file until the last minute. THAT is when they discover "conditions" that need to be met before closing creating a panicked situation for the Buyer to comply.
As a Realtor here in Northern Virginia, I do whatever I can to avoid these situations, but the sad truth is I have no control over the practices of the underwriter. If the settlement of the purchase gets delayed or even if the loan is denied the day before closing (and possibly placing the buyer in default) it is no problem to the underwriter. They just move on to the next file. Do they not realize that had they reviewed the file weeks before closing all parties to the transaction could have had the time to help meet the underwriters conditions? Do they even care?
I am so frustrated with this process. Why do they wait for the last minute? Got me. I understand they will need to verify information such as the buyer's credit again prior to releasing the loan documents for closing, but in my opinion, that is not the time to review the file for the FIRST time.
As a buyer, it is important to obtain a loan with a lender that has an "in house" underwriter. This makes it possible for the lender to work closely with the underwriter to establish a game plan to correct any conditions. If the underwriter is located in another location (most likely in another State!) then this opportunity is lost.
Need references for lenders in Northern Virginia with in-house underwriting? I have a list I would be happy to share:)
1320 Old Chain Bridge Road
McLean, VA 22101