Mortgage Closing Delayed - If your mortgage broker called and told you your closing has been delayed do not panic. Sometimes during the mortgage loan process situations arise that can set the process back a few days therefore delaying your mortgage closing.
Most mortgage closing delays happen because of something very simple like a pay-stub expiring, closing paperwork not being able to be prepared in time, title company or closing agent being delayed with other closings, bank or title companies computer system goes down, power goes out, etc... This is not a time to panic. Most of these delays are not because of anything major and they do happen even when you are working with great mortgage professionals. Some things are just out of everyone's control and sometimes simple problems occur. Therefore, just make sure that you and your mortgage agent are communicating with each other so that everyone knows and understands what is going on, why the closing has been delayed and when the new closing day and/or time will be.
Closing delays can occur for a variety of reasons; underwritig reveiw, appraisal review, company policy changes, program changes, etc. If you are working with a competent broker, your delay should be resolved within one week.
If your mortgage closing has been delayed with no good reason, contact your mortgage company representative and get an explanation. While in general mortgage closings are delayed for good reasons, if the explanation you receive does not sound legitimate you may be in a situation where the deal has fallen through and the broker is trying to buy time to find an alternative.
What happens at closing? - Closings are where most real estate transactions are wrapped up. Closing is where all parties involved in the transaction finalize all there agreed upon duties. The closing agents duty is to make sure all parties perform their agreed upon tasks.
At closing you will sign all of the documents that are required by the lender. The title company will notarize these documents and insure that the person or persons signing the documents are indeed who they say they are.
Depending on the type of transaction funds may or may not exchange hands. If you are purchasing a home the seller of the house will be given the proceeds from the sale immediately. If you are refinancing your home you will not receive funds on the spot, and will be required to wait until the 3 day right of rescission has passed before the title company will disburse funds.
What happens at closing? For a purchase, typically 2 things happen. First the sales transaction is finalized. Second, the financing agreements to make that sale happen are signed. Then, everything is notarized and recorded.
Are you in a state that requires an attorney to be present? If so, a closing agent will usually review your loan terms, then the attorney will explain the deed itself. This will be your last chance to ask questions, so use it; don't forget you are paying for the attorney.
Time from application to closing - You the consumer have the most control over how long the process takes...The better prepared you are before initiating an application by rounding up documents such as paystubs, tax returns, bankruptcy disacharges, bank statements, mortgage statements and such the faster everything will go...Your time and ability to pay for and schedule an appraisal is also a key to making the process go as quicly as possible...It can go from application to closing in as little as 10 business days, but it usually takes longer...If you get your documents together and have the time and ability to take care of the appraisal, you will make it go as fast as it can!...
The most common rate lock period for a home mortgage is 30 days, although you may get longer or shorter lock terms.
Also remember when you are refinancing your home you will have a 3 day right to recind your loan. This will delay your funding by 3 days compared to a purchase or a non owner occupied home that will find the same day.
Purchase transactions will normally take a little longer to finance from the beginning of the application process until closing than refinance transactions will take. With purchase transactions there are multiple parties involved, the buyer and the seller, whereas with a refinance there is only yourself and/or your spouse.
Other things that can take time are getting the appraisal done, getting payoffs back, and underwriting the loan.
If you qualify for a no documentation loan program, it may be possible to go from application to closing in 5 to 10 business days.
You have some control over some of the biggest delays in the application process.
First, getting requested documentation quickly to your loan officer is essential. A day or two delay when you have 1 or 2 weeks until closing may not seem like a big deal. However, your application may be sitting waiting for that documentation before it can move to the next step in the process.
Second, with a refinance, your previous mortgage company and any credit card companies you will be paying off may not be eager to stop earning interest off of you. So they may be slow in giving out information cincerning the payoff amounts on your accounts. Sometimes, your loan officer may think these companies will release this information more quickly to you. If you are asked to call and request this information, please do so quickly. Some companies often take 10 days or more to release this information.
Always remember that there are outside factors that neither your loan officer, nor yourself can control. Your loan officer will be doing whatever he/she can do to get the loan closed as soon as possible, but there are third party forces at work. The underwriting may take longer than anticipated, large sums of money need to be wired, and this industry works through technology. Computers, faxes, emails, wire transfers. As we all know, technology as a general rule speeds things up, but sometimes hiccups happen, and things slow down. Be patient, and be confident, your mortgage professional is working for the same goal as you. To get your loan closed when you need it closed by.
Your particular situation can affect the time from application to closing. Bankruptcies, chargeoffs, liens on the home, gaps in employment, missing documentation, condo association issues, title issues, appraisal issues, difficult to justify income, etc. may or may not affect timing. Discussing any items ahead of time with your mortgage professional can help everyone get to closing faster.
Sometimes a loan can take longer because not all information was fully disclosed to the Mortgage Professional from the begining. If there is a lien on the property being refinanced that should be disclosed because it will need to be paid off. Often it can take some time to locate the lien holder and get payoff information.
Depending on how fast you can provide your mortgage broker with the documentation he or she needs, application to closing can be as fast as 7-14 days.
Time from application to closing can vary based on several factors. Three important considerations are the amount of documentation the lender requires, how long the borrower takes to provide information and the efficiency of the lender.
Present your mortgage professional with as much documentation as possible initially. It is much easier to to have "too much" information rather than "too little" information. Think of it like dressing for the weather: it is always easier to take something off rather than go home to put some thing additional on.