Home Closing Date
When you enter into a real estate purchase contract, you need to list a tentative closing date. Tentative closing dates are normally 30 to 45 days after acceptance of the contract from the seller. Very rarily does it go beyond 45 days but sometimes both buyers and sellers do want an extended closing date. Many real estate agents will tell you that more times than not, closing dates gets delayed or post poned due to the home buyer’s mortgage lenders. There is absolutely no reason why a closing date cannot be met. There are conditions that needs to be provided to the mortgage underwriter prior to a clear to close but those conditions should not wait until the last minute. 30 days to close from the signed real estate purchase contract should be more than enough time.
Reasons Why Home Closing Date Cannot Be Met
There are legitimate reasons why a real estate closing date cannot be met. One of the most common reasons why an initial closing date cannot be met is when an appraisal comes in lower than the purchase price. If an appraisal rebuttal is requested, than the sellers real estate agent needs to provide comparables rebutting the original appraisal and the appraisal rebuttal request needs to get submitted to the Appraisal Management Company. It might be a 3 to 5 day turnaround time for this process to be completed. The buyers and sellers also may need to negotiate a new purchase price and a addendum to the initial purchase contract needs to be provided.
Home Closing Date Delayed Due To Mortgage Conditions
Other reasons why a closing date cannot be met is turning in the conditions to the mortgage loan underwriter. Conditions are things such as W-2s, tax returns, bank statements, verification of deposit, verification of employment, verification of rent, letters of explanations, and other requests stated on the conditional approval.
Conditional Mortgage Loan Approval
Once your mortgage application has been processed and submitted to underwriting and assigned to an underwriter, the underwriter will go over every aspect of the file. If the file has missing information, the file is then kicked back to processing and this will cause a delay in the mortgage approval process. It is extremely important that a mortgage loan processor submits the complete mortgage package along with the required documents. If the processor skips say a tax return or bank statements, the underwriter will reject the file and the file is now at the end of the underwriter’s roster and needs to start over. Sometimes it is best not to submit a mortgage application package until every single document has been collected. This might delay the underwriter looking at the file but overall, it will be a speedier mortgage approval process.
Getting A Clear To Close
Once the underwriter reviews your file and determines that it meets the mortgage lender’s underwriting and mortgage approval guidelines, the underwriter will issue a conditional mortgage loan approval. Once the conditions have been met, a clear to close will be issued. A clear to close is that the mortgage lender is ready to fund the mortgage loan. Many times closing dates gets post poned because the mortgage conditions are not turned in until the last minute. If you want to meet the closing date, you should gather up all the conditions within 24 hours from the issuance of the conditional approval and submit it back to the underwriter. You need to understand that once all conditions have been met, a second round of conditions can be requested as well. By Gustan Cho www.gustancho.com