How Long Does Mortgage Loan Closing Take From Application To CTC

This BLOG On How Long Does Mortgage Loan Closing Take From Application To CTC Was UPDATED On July 15, 2017

A normal mortgage loan closing normally takes 30 days.

  • However, we can probably expedite a mortgage loan closing in a case of an emergency.
  • There are instances where home closings can be done in less than 2 weeks.
  • If borrowers cooperate with the mortgage lender in getting all required documents and conditions, closings can be expedited.

Mortgage Application

The first step towards a mortgage loan closing is the mortgage application.

  • The first step in the mortgage process is when the loan officer takes an official mortgage loan application called the 1003.
  • The loan officer will prepare the 1003 mortgage application for loan applicants.
  • Borrowers need to sign and credit will be pulled.
  • Loan officer reviews credit and runs file through Automated Underwriting System.
  • Pre-Approval is issued.
  • Once borrowers get executed real estate purchase contract, disclosures gets issued.
  • Borrowers need to sign proper disclosures and a list of required documents that will be needed. 
  • Required documents include two months bank statements, two years tax returns, 30 days pay check stubs, two years W-2’s, 12 months cancelled checks for rent verification, asset information such as 401k or IRA statements, and other documents that apply to the mortgage loan borrower such as bankruptcy papers, child support payments, divorce decree, etc. 
  • This process normally takes no more than two days.
  • The Mortgage Process has officially started.

Mortgage Processing

Once the loan officer has the real estate purchase contract and documents required, the loan application gets assigned to a mortgage processor.

  • Once borrower has submitted signed application and all the required requested documents, it gets processed. 
  • The mortgage processor makes sure that all of the information in the mortgage application is correct.
  • Mortgage Processor makes sure all the necessary documents are in order to avoid potential conditions by the underwriter. 
  • Processing takes one to two business days. 
  • The loan is then submitted to underwriting.

Underwriting Process

Once the mortgage loan processor has processed the mortgage loan application, it gets submitted to the underwriting department and is assigned to an underwriter.

  • The underwriter goes through application and verifies all the information on the application and cross checks it with the documents. 
  • They verify tax returns with the IRS, make sure there are no overdrafts on bank accounts, and makes sure that are able to afford the monthly mortgage payments. 
  • They also review credit report and will note any discrepancies and vague items that need clarifying. 
  • This normally takes two days.

Conditional Loan Approval

Once the underwriter reviews your file and is comfortable with your ability to pay, you will get a conditional approval.

  • The appraisal is then ordered and the underwriter will issue additional conditions, if any, for clarification such as updated bank statements, updated pay check stubs, verification of employment, or other minor conditions.
  • The appraisal normally takes a week. 
  • Once the appraisal is turned in, the underwriter reviews the appraisal and will grant a clear to close.
  • To be on the safe side, a 30 day window is what it takes for a mortgage loan closing. 
  • However,  the fastest a mortgage loan closing can occur is three weeks as long as everyone is on the same page.

Related> Why Mortgage Loans Do Not Close

Related> Timeline From Pre-Approval To Clear To Close

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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