Causes for Delays in the Mortgage Process
“We are clear to close”, words every homebuyer longs to hear from their mortgage banker. Well, if that is the finish line, so to speak, and we know how the race starts; then what keeps what should be a 5k from turning into a marathon? Some factors of course, are beyond our control (those are the most frustrating) but there are things as home buyers that we can do to delay the mortgage process. This is obviously counterproductive so being aware of them upfront is going to set us up for success!
There is a lot of documentation needed, it’s true. It can feel invasive and overwhelming. But without these items then your mortgage banker has his or her hands tied. The quicker you can get the needed items to your mortgage banker the quicker they will be able to start processing your loan. This may even require you to seek out lost documents; for example, when we purchased our home recently, I spent a couple hours pulling together the documents needed from the paperwork we have acquired over the last 5 years of our marriage and even ended up driving to the county clerk and child support office for further documentation. This part may not be the easiest but the faster you can make it happen the faster the mortgage banker can get to work! Use this link to access our mortgage document checklist to make sure you have it all!
Not using e-consent upfront. Technology has awarded us so many useful tools and of course each industry is going to use them to work more efficiently! That is where e-consent comes into play. We are happy to meet with you to have your documents signed or you could print them out yourself and drop them off. But we are busy, as a society, most people I know fantasize about doing nothing, “nothing, just for one weekend”, they’ll say. So, imagine if you could remove coming into sign documents and could just do it from your phone or computer? It will save you time throughout the process and will give your mortgage banker the ability to move quicker in having a quicker response from you.
Another thing to look out for is, where is the processing and underwriting done? Many times, these services are contracted out which means that your file with all your information is sent to another company who then has to go through it and make sure that everything is in line with the loan requirements. However, if your lender offers in-house underwriting and processing then they can track the file and know where you are in the process. It isn’t going to get lost in the shuffle, so to speak.
Lastly, we as homebuyers need to be aware that what comes into and goes out of our bank account during the processing of our loan can cause delays. Any big purchases made on credit can cause delays in the process because now they have to go back and reexamine any changes in your credit. This can be tricky for some because with the purchase of a home a lot of people are also buying their first washer and dryer or other appliances. If you fall into this category and feel that you can’t wait until after the closing to purchase these items, it is best to let your mortgage banker know up front so you all can create a game plan. But it’s not just big purchases. Large deposits can also send up red flags. Every deposit must be sourced so if your grandma gives you a check to help with your first home go ahead and make a copy of that check to give to your mortgage banker. Or ask her if you can hold onto it and deposit it after the closing! With that said, large cash deposits are hard to source so if possible, have your deposits made via check, instead of cash.
Keeping these things in mind up front will help you reach that finish line sooner and hear those words, “we are clear to close”.