Can I Get A Mortgage Clear To Close In 2 Weeks Or Less?
I run into situations where a home buyer contacts me to tell me that they have just got denied for a mortgage loan from a lender at the last minute and need to know how fast I can get them approved and closed. I often get about a dozen requests like these every year. The most recent rush request I had, I had the mortgage loan closed in 14 days from the day I received the signed completed mortgage application and the requested documents back.
Every mortgage lender handles their mortgage application and approval process differently and their timeline is different. Some mortgage lenders will take longer to process and underwrite a mortgage loan file than others. For example, lender A may take 3 to 5 business days to process a mortgage application and submitted to the underwriter and 5 to 7 days for the underwriter to review it and issue an approval. Just these two process alone, you are talking 2 weeks. You then have the appraisal that you need to order after you get the conditional approval from the underwriter which can take another 7 days. Once you get a conditional approval, it may take a day or two if not more for the mortgage applicant to gather all the conditions and provide it to the mortgage loan processor. The mortgage loan processor then submits it back to underwriting which may take another 5 to 7 days for them to review conditions. If all the conditions are met, then a clear to close can be issued but the chances are there may be another round of conditions. If another round of conditions is requested by the mortgage loan underwriter, then it will take another 5 to 7 days for the mortgage loan underwriter to re-review the new sets of conditions that has been requested. You can now see how the mortgage approval process can take a while and how mortgage loan closings can get delayed.
Ask Your Mortgage Loan Originator What The Turnaround Times Are
Ask your mortgage loan originator what the turnaround times are for processing, approval, and conditions. Ask how long their company takes to process a mortgage loan application. Every mortgage lender has different turnaround times. Some mortgage companies will process a mortgage loan the minute the completed mortgage application and required documents are provided to the mortgage loan originator. Other mortgage companies will time stamp the completed mortgage package and will be placed in a bin and might take anywhere between 24 hours to 72 hours before the mortgage processor gets to the mortgage loan package. Once the mortgage processor has completed processing the mortgage package, it then gets submitted to the underwriting department and it may take anywhere between 24 hours to 72 hours before it gets assigned to an underwriter. If the mortgage loan underwriter issues a conditional approval, the conditions is what can delay the mortgage loan clear to close. The mortgage loan underwriter will send the file back to the processor with the conditional approval and it is the mortgage loan processor’s job to provide all the conditions. The mortgage loan processor will then gather all the conditions requested from the mortgage loan applicant and submit them back to the mortgage loan underwriter. If all the conditions are met, then a clear to close will be issued. If there are any missing documents and/or pages from the documents requested, then it gets kicked back to the processor and this is where delays happens.
How Can A Mortgage Application Get A Clear To Close In 2 Weeks Or Less?
To get a clear to close and funded in two weeks or less is never a guarantee but definitely doable. Everyone’s cooperation is needed and no delays on conditions can happen. To do a 2 week close, the mortgage loan applicant needs to cooperate with satisfying conditons when requested. First, all mortgage loan documents such as two years tax returns, two years W-2s, 60 days bank statements, recent paycheck stubs, and other documents must be complete with no pages missing and processed in one day. On day two the processor will submit the mortgage package to the underwriting department and make sure it gets assigned by the underwriter. At the same time, the mortgage loan processor will order a rush on the appraisal which should take no more than three days. By day three, we should get a conditional approval and the conditions should be minimal. While waiting for the appraisal, the mortgage loan processor will work on conditions, title, insurance, and other internal items necessary to prepare for the closing. Once the appraisal gets back, the mortgage processor will submit the final conditions as well as the appraisal back to the underwriter for a clear to close. The underwriter will take 24 hours to review the final conditions and issue a clear to close. Once we get a clear to close, we should be able to schedule the closing the following day. If we get a clear to close early in the morning, the mortgage loan can close and fund the same day.
The above is a realistic case scenario and situations like these happen. However, delays can happen in the event if the underwriter comes back with additional conditions that need to be satisfied, the appraisal comes back with issues, or there is a cloud on the title.