Loan Underwriting
Typically, several weeks pass as the verification reports and forms are returned to the lender. If any delays are encountered, the loan officer may contact you for assistance. The credit reporting agency may also call you to verify that the information they have gathered is correct.
Once the loan processor has collected this standard documentation, you may be asked to write letters describing your assets, income, or credit. Few loans are finalized without requests for additional information just before the package is submitted to the underwriter for final approval. At this point you may become frustrated with the loan process.
Please remember that your lender requests these letters to assist you in obtaining your financing. Do not hesitate to discuss any concerns with your loan officer. He or she can often provide additional insight on what may seem to be redundant requests.
Loan Amount Requested
Before the processor submits your file to the underwriters for final approval, he or she will verify the final sales price. Make sure that you provide copies of all change requests to your lender. This assists the lender in determining the exact loan amount. If change requests affect the total price after this point, you may have to resubmit your loan application for the higher amount, or the lender may require that you pay for the additional items in cash.
Loan Approval
During your first meeting, you and your lender determine the timing to obtain prequalification. This allows us to start the home even though final approval is still pending. You will discuss additional items that you may need to obtain final loan approval. Several weeks after your first meeting with the lender, you should receive loan approval. If any of the documents requested have not been returned to the lender in a timely manner, approval may take longer.
Contingencies
Loan approvals often carry conditions of approval. The sale of a previous home or proof of funds are two examples. Discuss any concerns you may have about such conditions with your loan officer and obtain any requested documentation as soon as possible. Once all contingencies are met, the final loan can be approved.
Loan Amount Approved
If you qualify for an amount that is less than you requested, ask your loan officer what changes might qualify you for a larger loan. Or, consider omitting some items now (such as a deck or finished basement) and adding them to your home later. Another possibility is to talk to another lender who offers different programs with different requirements.
Loan Declined
If, after your best efforts, you are not approved for a loan within 10 days of signing your purchase agreement, in accordance with the terms of that agreement, Classic Homes will refund your initial deposit upon your signing a release letter and returning this Homeowner Guide to the sales office.