There is a lot that goes into making an offer. Of course, price is the most important item, but it is far from the only factor. For most sellers, the ability to close quickly is just as important as the sales price. Getting out of the property in 25 as opposed to 90 days is a huge difference. Even the ability to close in 30 as opposed to 45 can give your offer a leg up on the competition.
You can’t put a 30 day closing on the contract unless you can deliver. If not, you run the risk of breaking the contract and possibly losing your deposit. 30 day closings can only happen if you are willing to work with your lender. Here are four tips to help expedite the loan process and get your deal closed in 30 days, or less.
Get prequalified early. No good real estate agent will show you homes unless you are prequalified. The prequal process typically consists of a credit pull as well as a quick application consisting of income, employment and down payment questions. At that point the lender will run the numbers and see what you are qualified for in terms of purchase price and monthly payment. Any questions, concerns and issues should be ironed out now prior to house hunting. You should know the exact monthly payment maximum, property tax amount and roughly how much money will be needed at closing. Only when you are comfortable with the process should you start your home search. If not, you will add a few days which could easily push you over your closing date.
Produce all items at once. Once your offer is accepted the clock is started. Mortgage guidelines have changed dramatically since the mortgage collapse. There are restrictions on when things can move forward and stages to the process. For instance, the lender may not be allowed to order the appraisal until three days after the application package is delivered. The best way to expedite your loan is to give your lender or loan officer everything at once. Omitting one item may not seem like a big deal, but the lender may not review anything until they have everything. Leaving out a paystub or copy of your drivers license has a much bigger deal than you think. Take the time to get everything at once.
Anticipate issues. After you give your lender the initial application items your work is far from over. You need to listen to them and always be one step ahead of whatever is needed. If you know you will need to provide an additional bank statement or paystub, don’t fight it. You may not agree with what or why the lender is asking for something but it is a fight you won’t win. If you know your drivers license copy isnt great, get a new one. If the contract needs to be initialed, go ahead and do it. The longer you wait and the more you fight the more days you lose to close.
Be ready to act. During the loan process you should try to provide any items that are needed asap. It is a good idea to play around with online banking, or scanning items from home before you need to do them. As we stated, not sending over a copy of an item on Thursday may cause the loan to be pushed to the back of the line. If there are a flood of new loans over the weekend it may be a few days until your loan conditions are reviewed. Whether you must scan from the office or take a drive to the bank to deliver documents you need to be ready to act for whatever comes your way.
If you get your lender everything they need in a timely manner it is possible to close in as little as 21 days. This takes a team effort from everyone, but make sure you do your part.