Congratulations! You’ve found your new dream home and are on the road to purchasing it. After falling in love with a new house and neighborhood, it can be agonizing to then wait weeks to move in.
The average time it takes to close on a house ranges from 30 to 45 days from the day your loan begins to process, but can sometimes take longer if you encounter any snafus.
Don’t despair. There are several ways to speed up the mortgage process and move into your new abode sooner than you think.
Ready to find out how you can accelerate your mortgage for a new home? Continue reading for our six tips.
6 Ways to Efficiently Process Your Mortgage for a New Home
Being prepared and organized when you go in to make an offer on a new home is essential. Follow our six tips below to ensure you move into your home quickly:
1. Have a Lot of Cash Saved
You will look more appealing to lenders if you have a good amount of money saved that you can easily get to in a 401K, bank account, or another type of liquid asset to cover your down payment, reserves, and closing costs. Having money in reserve will show lenders that you will be able to still make mortgage payments if you suffer a loss of income.
2. Have All Your Documents Prepared
Your real estate agent and mortgage lender will tell you what documents you need to get approved for a mortgage. This type of documentation includes proof of your income, so have your tax returns and W-2s from the past two years ready.
Have current bank statements and any proof of investments or other financial assets prepared. If you are receiving child support or any type of divorce settlement, the mortgage lender will want to know that as well.
You will need to be completely open and honest about your finances with your lender. Ask questions about every aspect you’re unsure of. Leaving out important information will only delay or derail the process. If your lender asks for additional documents, send them immediately. It will only save you time and will keep moving the mortgage process along.
3. Pick an Experienced Realtor
A knowledgeable real estate agent will be an asset to you in multiple aspects of your home buying process. Not only will they help you find the perfect home and get you the best price possible, but they will also be your spokesperson during escrow.
They can help instruct you during the closing process and let you know of any potential problems you may encounter. Your realtor can let you know what documents you will need in advance so you can be prepared. If you don’t have a proactive real estate agent that isn’t thinking two steps ahead, you’ll learn about things as they arise, which will slow down the process.
4. Avoid Any Major Life Changes
When you’re in the process of buying a home, you should avoid making any big changes to your life that could affect the mortgage approval process. That ranges across a variety of events:
- Making a large purchase such as a car, furniture, or appliances
- Opening or closing accounts
- Quitting or changing jobs
- Changing where your down payment comes from
- Missing a payment on any major account
If any of the above items occur, it can delay your loan approval process and potentially lead to your loan getting denied. You also don’t want your debt-to-income ratio to change, resulting in you having to provide a larger down payment, getting a higher interest rate, or a loan rejection.
5. Respond Quickly to Any Requests
No matter how prepared you are, there is always something unexpected that seems to pop up. Whatever it is, be it information about your income, documentation regarding your down payment source, or any other items, get it to your mortgage lender as soon as possible.
The more organized you are in advance the better. Even if you don’t need a certain financial document at the start of the mortgage process, have it in a convenient spot so you can quickly send it over when it is requested. Scan certain items onto your computer so you can email them immediately, rather than waiting to hand-deliver them to the mortgage offices.
6. Look Out for Problem Houses
Some homes may seem perfect on the outside, but then a loan will get rejected by the lender because of problems with the house. This could include issues with the property, including an issue found in a title search or an outstanding lien. It could also be a problem with the physical house.
A house could be difficult to get an appraisal for. You may be looking to purchase an old farmhouse that is in the back corner of a new subdivision. There are no nearby houses to make comparisons to for the loan amount.
Lenders will look at if the house needs significant repairs or if it will be hard for them to sell if a foreclosure happens. They are more apt to back loans on houses that are well-maintained and fit in with the surrounding homes.
On the same note, you should limit seller concessions. Asking a seller to make certain repairs before the close of the house could delay the entire process. If you want to close quickly, explore asking for financial concessions instead of the seller making repairs. It may cost you more money in the long run if you then have to make the repairs yourself, but it will move the process along and you will ensure everything is done to your liking.
Get Your Mortgage for a New Home Approved Fast
Buying a new home is a huge life step and one that you should be prepared for. You don’t want to rush through the process, but there are easy ways to avoid any unnecessary delays. Having a real estate agent that you trust and your documents ready will set you on the path to a seamless and trouble-free mortgage approval process.
Contact us to discuss building your new home today.
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