Why Does It Take So Long to Get a Mortgage?
Finding the perfect property is not always easy.
Once you have discovered it, you are ready to pounce on it before someone else gets the chance. But why can it sometimes take a while for you to hear back from your lender about your loan application?
Standard will help you clear the hurdles that are mortgage applications.
The mortgage process is lengthy due to regulations that aid in keeping not only you, but also the lender safe from foreclosure or fraud.
Below are four of the new regulatory changes that cause getting a mortgage to be time-consuming.
Comparing lenders can take up to two weeks.
The last thing you want is to choose a lender without doing research first. Keep in mind that your mortgage lender will be your partner for several years. Educate yourself on what you should expect out of a mortgage application
for mortgage providers.
Upon finding someone you can trust, plan a meeting with the local loan officer, who will offer you a mortgage rate and run your credit.
You can contact as many lenders as necessary without consequence. FICO (Fair Isaac Corporation) allows you to rate shop for a mortgage over a two-week period without it changing your credit score. During this period, credit bureaus will file the first report as a notch to your score, but the next ones will be disregarded.
Compiling paperwork can be tedious.
In 2015, the average mortgage took forty-five days to close. One reason why this process is so time-consuming is due to the fact that you must compile a considerable amount of paperwork for the lender. In order to be approved by a lender, you also need to provide them with proof of income via your bank statements, retirement accounts, tax returns, W-2’s, and support those not-so-good items on your credit report. By law, the lender must believe that you are able to repay your debts before he/she can offer you a mortgage.
The process of getting a lender to verify your application is complex and lengthy.
Once you hand in your paperwork, it is likely that your loan will be read by 20+ people. such as the settlement, processing, and underwriting teams. Now that interest rates are low, the lender may really have a plethora of documents to process, most likely slowing the procedure even more. Additionally, these teams are required to verify every piece of paperwork that you have turned in. This means that they must view your rental records from prior landlords, obtain your mortgage history from credit bureaus, and call your previous and current employers.
It is unlikely that a home appraiser will be able to visit your dream home as soon as you’d like.
It is necessary to get your dream home appraised in order to know its value. Appraisers have varying schedules, which can either mean that you can get on their schedules ASAP—or it may take a while. Your real estate agent may know an appraiser that could expedite the process; however, if you do not already have a relationship with one, you may have to wait to get on their schedule.
While our main concern at Standard Mortgage is to present you with expedited service, we understand that regulation is necessary. We promise to walk you through the regulatory process as efficiently and swiftly as we can.