APPLYING FOR LOAN TO CLOSING- TIME FRAME

It makes difference what kind of loan you apply for. VA and FHA requires government approval, special appraisals, etc. So those take a little bit longer to “put together”. Conventional loan is easier to process. As financing rules changed in October 3rd 2015, we were told by mortgage lenders and title companies that this process will last no less than 2 month. It was really scary month...and...nothing really happened. If you are planning to purchase home, there are 2 items that contribute to length of transaction (as far as getting loan is concerned):

1. Choosing right lender. Do your homework. Ask friends, your Realtor. Do not apply with bank, just because your checking and savings account is with…”. It will not make a difference. You will not get better service, rate. But honestly, in the last 3, 4 years I have never had positive experience with big banks. Buyers are treated like numbers. Loan officers usually are not experienced. They give out approvals without asking questions. And because of that, while your dream home is waiting for you, every week there is new issue that bank needs to fix. New paperwork that you need to provide. But if you chose small, but reputable mortgage lender, you will get asked all kinds of questions at the time of applying, so if there are any issues that may arise, you can start working on clearing those right away. You will get personal treatment, good follow up.

1. YOU. Yes...you. I have to say this and I know that buyers will not be happy to hear it. But as buyer, you have to be “on top” of things while working on getting your loan. Good mortgage lender will tell you exactly what paperwork will be required from you (like bank statements, tax returns, pay stubs, gift letters, etc). Unfortunately more than once I have heard from lender: “I told buyer to give me all this two weeks ago and every few days when I call, there is another reason as to why I still do not have it”. Your loan officer gathers everything that is needed, orders appraisal, etc, makes sure that all is correct and then submits to underwriter for approval. Underwriter is person who will make decision if loan will be granted. She/he will not look at your documents until everything is in place, and your paperwork is not the only file that this particular person has to review. If market (like it is right now) gets busy, underwriters have hundreds of files to process and ready paperwork may sit on their desk for a week or so. The longer it takes you to get “all ducks in a row, the longer process will last.        

But if all is done correctly, getting conventional loan should not take longer than 30 days and FHA or VA- 45 days.