Up Dated February 2010
Yesterday I received the following question from K.S. who lives in Antelope, California. I want you to know I get this question over and over. It is one of my pet peeves because there is absolutely no reason for it to be such a frustrating reality to so many people applying for a mortgage. Here's the question:
"how long do i have to wait for underwriting???? i have been waiting week after week. he said completion review would be complete the 19th after last week he said 48 hrs .. last message he sent said he would know more on the 19th ...gr"
The amount of time in underwriting depends on the lender, the type of loan, the issues that need to be resolved, and how saturated the market is. It can take 1 (one) week or up to 6 (six) weeks (worse case).
I don't know what the issues are on your loan or what type of loan you are qualifying for. However, your loan officer does!
Sometimes the problem of time is an issue of "when it was REALLY submitted" to the underwriters or what issues still need to be resolved. Your loan officer needs to be totally up front with you. If you don't think he is, ask to speak with his broker/manager.
I'm serious about this issue. You need FACTS! Ask exactly when it was submitted. If it has been more than two weeks, you have a right to know exactly why. Ask for documentation. No kidding. It is your loan and you are paying them a lot of money to broker it. You should demand, without being arrogant, real and true information.
I found out during the conversation with K.S. that the Company she is doing business with is one of , if not the largest Lender in the US. That is too Sad. I also found out she is applying for an FHA loan and in all fairness these loans do take a little longer to close.
Like I said, this is one of my pet peeves so let me tell you why. I've been in the business for a long time and pretty much seen it all. I know that sometimes an incomplete package is submitted to underwriters. I know that there can be issues with appraisals or titles that can take time to correct or clear up. Sometimes a simple VOE will take longer than it should. Sometimes the borrower may be a little weak in some areas and the underwriter may ask for more or unusual documentation, they have the authority to do that.
I also know that sometime, more often than we like, the package just doesn't qualify under that lenders guidelines so the loan officer starts sending it out to numerous other lenders while he prays, and I mean literally prays that one of these lenders will approve it out of the kindness of their heart or that perhaps that their guidelines are not as tight. Well, we have all been there and every now and then it works, ... but at this point it is usually a lost cause, only that, ...we just can't let it go because we are heart broken for the borrower and we find ourselves in a state of denial.
If you are in the business you know that all these scenarios are reality and do take time. OK, so here is the issue I have with all this. This is why it angers me so: While all this is going on the borrower is left in the dark.
Most borrows don't understand all the steps we go through or the documentation process. But it is their loan be it a good one or not. They are paying a lot of money for this process. We owe it to them to keep them informed about any problems or issues that arise. They are part of the process. They have a right to know and if they don't understand then we must explain it so they do. Our avoidance of the issue and reluctance to inform the borrower puts them through a tremendous amount of stress and anxiety.
Borrowers, people, you and I, ... all expect to be treated with dignity and respect. We expect honesty from the people we do business with and we expect the people we are doing business with to have integrity and compassion. Pretty simple, huh? So why don't people get it right?
Borrowers have a right to know and the loan officer or company has an obligation to keep them informed.
Alright, I'm Done. I do hope I don't get this question again for at least a week!
I originally made this post in 2008. Today, in 2010, all the above still stands true. However, the mortgage market has changed so in the past two years that there are additional factors causing delays.
The mortgage crisis and federal intervention has most lenders/underwriters being more conservative due to "fear of the feds". Unfortunately this is a fact. I have heard it from many underwriters.
Appraisals and property value is another big issue that causes delay.
The low down payment or no down payment programs are overloaded now that the subprime loans are gone. They don't have enough staff to handle the volume. This causes great delay.
As a consumer you still have a right to know the status of your loan. Demand it! If you have questions leave them in the comment section and we will respond.
Mortgage Underwriting Process
Tuesday, March 18, 2008
Up Dated February 2010
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