Mortgage Timeline – What you need to know
How much time do I need to complete my mortgage?
One of the biggest things that most of my clients do not realize is that it takes time to get a mortgage. Contrary to to what some people believe (you know who you are) you can not walk into a bank on a Tuesday and expect to have a mortgage on Wednesday. There is a certain amount of due diligence the lender wants to to do on you and the property…..and this takes TIME. I’m going to lay out the steps and associated timeline for a mortgage below in the hopes that the small percentage of society that calls me up every week looking to fund a mortgage in 2 days will see it and take it into consideration the next time they need a mortgage. I am going to lay out the steps for purchasing a house, but it will also be approximate for refinances and switches. And of course always get your mortgage pre-approval before you go house hunting
Step 1 – Approval (time to complete: 1-2 days)
Once you have an accepted offer make sure you or your agent fax a copy of the signed agreement and MLS listing to your broker. This si waht I use to get all of the particulars of the house and the deal and allows me to send the file to the lender to get an approval.
Step 2 – Fulfill Conditions (time to complete: 3-4 days)
Once we get the approval back from the bank there will be a list of conditions that will need to be satisfied such as proving the downpayment and your income. In my next post I am going to talk a bit about all of the documents you will need to provide to complete your mortgage, but for now all you need to know is you are going to probably have to provide a letter from your employer, paystubs, possibly tax returns etc. You will also need to set aside an hour or so to sit down with your broker to walk through the fine print of the mortgage and sign all of the documents required.
Step 3 – Appraisal (time to complete: 2-4 days)
This step is usually done at the same time as step 2. Depending on the lender and if the mortgage is going to be insured you may or may not even require this step. Unfortunately you are at the mercy of the appraisers schedule at this point. If he/she is busy it could take a week for them to view the property and write up the report. If you are lucky enough to find an appraiser that is slow, they can normally get it done in a couple of days. I will talk more about appraisals in a later post.
Step 4 – Sign at the lawyers Office (time to complete: 10 days)
The final step of any mortgage is signing the final legal documents at your lawyers office. For this to happen your lawyer needs to receive a package from the lender (usually about a week before) so they can draft the final papers for you to sign. One of the most import numbers to remember is 10. Most lenders will require atleast 10 days between the time they receive all of your supporting documents and the closing day of the mortgage. This gives them enough time to send your lawyer the info they need and have the mortgage close on time.
Please make sure you have atleast 2 to 3 weeks for your mortgage from start to finish. It makes the experience far less stressful for everyone involved and will give you access to more lenders since some will refuse to even look at a deal that doesn’t have atleast 2 weeks until closing. Of course exceptions can be made in certain circumstances and mortgages can be rushed through the process in 5 days, but lenders do this with great hesitation and very few will do it at all.
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