Scott Storace - Branch Manager, 100 Pacifica Drive Ste. 140, Irvine CA 92618 NMLS #226339 949.973.0141

"From the minute you call me to the minute we close, I have your back. No hassles, no banker’s hours & quick response times." - Scott Storace

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Closing A Home Loans:How Long Does It Take?

Time for Closing A Home Loan

Orange County, CA – When people are trying to purchase a property, quite often, time is of the essence. When you’re in direct competition with other people to buy the same house, you need to be able to get yourself into a position which will be taken seriously by the seller. In areas like Orange County where demand is extremely high, often times the quicker you can close the better chance you have of having the seller accept your offer. This often means getting your loan sorted out. Naturally this leads people to ask how long closing a home loan will actually take.

To give a fuller understanding of how long it can take to get a loan through, a bit of history is useful. A few years back, when less documentation was required from the borrower, closing a home loan was a rapid process. There wasn’t much information to collect for the lenders, and they didn’t have as much criteria that they had to sift through. Nowadays though, it’s a different animal. Increased regulation of the mortgage industry has forced more detailed underwriting. Investors like Fannie Mae and Freddie Mac can force lenders to buy back the loans they originated if they don’t meet all of the investor guidelines. This can be very costly and detrimental to lenders. For smaller lenders it can lead to their demise. Therefore, underwriters are scrutinizing every piece of documentation. Therefore, the whole process is taking far longer than it used to do.

There are other variables that can impact the time for closing a home loan. How unique is the property? The more unique it is, the harder it will be for the appraiser to find similar homes to use in the report. If there are not enough comparable homes the underwriter may require a second appraisal.

What about interest rates? Yep, interest rates play a factor too. With rates at historic lows, many homeowners want to refinance their loans and lower their payments. This increased loan volume can strain the resources of lenders and clog their pipelines. Moving things through the pipe takes more time and can slow down the purchase process.

As things stand now, the average length of time for closing a home loan to be completed is around thirty days. More difficult loan scenarios will require more time. In some cases it can be as much as 45 or 60 days.

Thankfully, away from all of these problems, a well documented loan can really fly through the system, and the times quoted above can be closed in as little as 2 weeks. This is not the norm as there is a significant amount of work to complete in that time.

The best way you can help ensure the fastest closing possible is to provide your documentation quickly. If your loan officer requests something new, provide it. Sometimes the underwriting process feels like a personal indictment. However, it’s the state of the market. If you want to challenge an underwriter you certainly can. However this takes time to do. It’s time that can’t be recovered and the results are not guaranteed.  You have to ask yourself what’s most important to you. If closing a home loan quick is the answer then turn over those documents as switftly as you can.

In the end, the best way to tell how long a loan it will take for closing a home loan is to ask your loan officer. They will be most familiar with your particular scenario and are best suited to advise you.

If you’re in need of a quick close contact me. We can discuss your needs and scenario and identify a plan to meet your deadline.

Scott Storace

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