For closing a normal purchase transaction, expected time should be 21-30 days. These closing times are for electronically submitted and eSigned loans.
Manufactured home purchase transactions may take longer, because many of the funding lenders who advertise 21 day closings, do not provide funding for manufactured homes. As time goes by, this too will change.
Like it or not, with every year that passes, the requirements, disclosures and borrower protection list grows so that closing your purchase loan has more time-tables and delays.
The Purchase Contract reflects a target date for closing, however the loan file has not even begun, so no one knows about the surprise credit issues the borrower has, or that the property appraisal may show required repairs. Each time a loan condition is reviewed, the underwriter knows more about and loan file and it’s hurtles, and the review can generate more ” loan conditions.” Conditions means, we have conditional loan approval, based on producing documents that support the listed loan Conditions.
The following time table is for the “old fashioned” loan closing methods, where paper is sent to the borrowers, and returned and scanned by the loan officer. Trump may undo the Dodd-Frank Law, so thing may change beginning in 2017.
Some borrowers do not have computer knowledge or the equipment to receive eSigned documents, so the slower method is used. Below are some general guidelines for certain steps in the loan process.
1) Begin counting 30 days from the time processor receives the signed loan application and all the requested borrower stipulations (basic documentation), and is ready to upload the loan submission to the underwriter;
This assumes a “standard” type of loan approval, without major delays due to special condition requirements. Manual underwriting is not standard. If the borrower’s credit score is too low, the loan application can be manually underwritten.
Very often a borrower will take several days to gather and submit the required documentation, which support the facts stated on the loan application.
2) Then add 15 days for lender quality control and prior to closing disclosures:
BELOW ARE GENERAL FUNDING LENDERS, CONDITION TURN-AROUND TIMES:
Each upload to the underwriter has to contain a minimum of 60% of the outstanding conditions,
Allow 3 days for underwriter review for each group of uploaded conditions.
Examples of Final review times, of all required and submitted conditions and disclosure business days time table:
3 days for final conditions review by funding lender;
2 days for quality control;
3 days for CLOSING ESTIMATE rescission DISCLOSURE time to run;
Can be 5-7 days if borrower does not electronically acknowledge CE disclosure receipt;
FUNDING LENDER IS NOT REQUIRED TO SEND DOCUMENTS OUT FOR SIGNATURE, PRIOR TO THE 3 DAY RESCISSION TIME EXPIRING.
2 days for loan documents to go out to escrow.
TOTAL OF BUSINESS DAYS FOR THIS PHASE OF THE LOAN PROCESSING – 10 days.
So, as you see, there are “hidden” time delays within the loan process. With an eSigned loan, everything moves much faster. The above time estimates may only somewhat apply to your loan, depending on the type of loan submission you are able to receive.
Please call me to discuss your specific loan submission challenges. Judy 909.797.1024