Home mortgage going slow? Get prepared and get approved faster!

As most folks know we are facing an unprecedented shift in the real estate industry. Even though the process of buying and selling a home has changed, much of the doom and gloom has been sensationalism! People ARE being foreclosed upon, people are being laid off, home values have dropped in most regions of the country, but many people are currently enjoying new homes. Banks are still lending money, and overall the process to purchase a home hasn’t changed that much. The largest difference today is that the DETAILS are being watched more closely than in over a decade and sloppiness is now resulting in delays and sometimes even declined loans. Whether you are a buyer a seller or a realtor there are things you can do to keep your transactions moving to the closing table. This week let’s talk about the borrower. If you are buying a property or refinancing mind the details carefully. If you are buying make sure that you are aware of the dates on your Purchase and Sales contract. You will have a Transfer of title date and a financing contingency date. Make sure that you and your realtor have allowed enough time to complete a reasonable loan process. I recommend at least 45 days for a conventional or government loan and 60 for a renovation loan. When you sit with your mortgage professional make sure that they provide you with a complete list of the documents that an underwriter will need to review and approve your loan application. Always offer complete documents. If you are providing a bank statement or a statement of an investment account include EVERY pager even if it is blank. The underwriter will not know that the page that is missing is blank and will likely condition for the missing page prior to a final loan approval. Make sure that your bank statements and investment statements include your name, account number and the name of the institution, that the statements are dated within 30 days of the closing date for the loan and that the balances shown include enough funds to meet that requirements of the loan. If you are buying, you should have enough in your account to meet your down payment and closing costs. Many people print statements off of a PC today. It is convenient, but often incomplete. If name, account number and institution are not on the statement then you have not met the requirement. You will need to go to your banker and ask for a stamped copy of your account history with the proper data included. Make sure that your tax returns are included for 2 years and if there are W2’s (for wage income) include them as well. Make sure that you (and spouse if applicable) have signed your returns. If they have not been signed (above the preparer signature line) then go ahead and sign them prior to submission. Keep all of the employment, income and asset information together. Don’t make your loan professional search for the items that were on the list. Incomplete files = suspended files = delay!! If you have any extenuating circumstances such as employment gaps or derogatory credit history make sure that you write a letter of explanation to your mortgage professional so that the underwriter will have a clear understanding of the big picture before underwriting your file. Understanding that you have had problems and how you have dealt with them and why things are more stable now is critical to a loan approval. These are some of the pit-falls to be aware of. Anything that you do not provide ahead of time will likely be conditioned for later and then your loan file will go into a pile with other loans that need to be re-underwritten causing delays of days and sometimes weeks. These delays can be minimized and avoided with a little attention to detail up front. One other idea is save time early in the loan process. Along with paperwork submission, this is the time in any transaction that you have most control over. When you are buying or refinancing you can order appraisals and home inspections today or tomorrow, instead of next week. These types of reports can often take a week to complete even after the physical inspection has been done. Most lenders will not review a file until the appraisal is with it. This means that the sooner those reports have been provided to your loan professional the sooner all of the docs can be sent to the lender to be queued for review. A week saved now is a week that won’t be needed later!! The fact is that banks are moving a little slower and the guidelines to borrow money have become a bit more stringent so if we learn to control the things that we are doing then there is more time for the bank to do their job and get your loan approved and closed on time. Extensions on P&S contracts and interest rate protection can be costly and they are usually unnecessary and can be avoided with a little practical knowledge!!
In the meantime, keep shopping for that house, refinancing to a new lower rate and knowing your role in keeping it all moving on-time!

Jeremy Lindquist
Managing member
Lindquist Mortgage, LLC

It's time to test my new Blog

Hello all, this is Jeremy Lindquist and I'm going to be sharing tips, ideas and mortgage advice - along with some of my whit and wisdom with all those folks who might be interested! Check back soon for more updates.

-Jeremy Lindquist