Fast, fast mortgage closing
Closing your mortgage loan quickly makes everyone concerned Happy, Happy, Happy. Your Realtor will be beaming because you are. Your mortgage broker can add your file to the “Winning” drawer with a warm sense of accomplishment. The title-company closer can move on to the next successful transaction with a smile. The sellers, who wanted to close yesterday, have reduced their anxiety level from 100 to zero and can now have a glass of champagne and call the movers.
When your loan closes quickly, there is less risk of something changing in your life during the processing period prior to loan approval. Many borrowers don’t realize that there are actually two phases to the loan approval process. The initial phase of mortgage underwriting is verifying your income, assets and credit. Your employment is confirmed and the home is appraised. The final phase happens a few days before closing and determines if there has been a “material change” to the contents of your application.
So, what constitutes a “material change” to your loan application? Almost anything! During the loan-application process, there should be no change in the source of your down payment, or in your job or income. And these things should not happen: missing a bill payment, applying for a new credit card, purchasing or leasing a car, making a major purchase using credit, and making a large deposit into your bank account.
Any of the above events will slowyour loan approval and can possibly cause your loan to be denied. To start off on the right track, get the required documents in or- der and ready for the underwriter. These minimum standard documents are proof of income, federal tax returns, and liquid assets in the bank and credit scores. Rely on your loan officer and the mortgage processor for a complete list of items.
Credit scores reign supreme in the approval process. You can check your credit scores at no cost before you apply for a mortgage. Do it and avoid delays. (Errors in credit reporting are very common.) After submitting the required documentation to the lender, stay in touch with your mortgage loan officer and the person processing the loan. Borrowers who quickly respond to any request will see their loans approved quickly.
A fast, fast closing requires attention by all parties. Even today with all the electronic notifications, if you team with knowledgeable mortgage people the closing will be fast.
Jim Gay was a real-estate broker for 20 years and has been a consultant for Fortune 500 companies. He is currently a broker/owner atThe Mortgage Place, Inc. (986-9080) and can be reached at jim@ jimgayhomemortgage.com.