When I first started in the mortgage business here in the Chicago area almost 2 decades ago, it was normal for a home purchase to close in 60 days. That is a long time, but it took that long to close because that’s how long it took to get a mortgage approved. The financing contingency date (the date in the contract that you need to have your mortgage approved by) was usually 45 days after the contract was accepted. Everything took longer back then from the appraisal to underwriting. If a file needed to close in 30 days that was a real rush, and we had to pull put all the stops to get it done. Like so much else, that way of doing business is long gone.

Now most contracts are written to close in 30 days or less. I’ve had two loans this month that closed in under two weeks (one where the buyers went on their honeymoon in-between), and have closed loans in days when necessary. Because of technology life is faster paced and people expect things to move faster. So one of the questions I get all the time is - How fast can you close? My answer is usually - How fast do you need to close? The truth is, in most cases we can close quickly. We underwrite and fund most of the loans ourselves, which means more control, and we now have FHA direct endorsement so we can close FHA files as fast as conventional ones. But there are still a lot of moving parts to getting a mortgage approved. In order to close a loan quickly everything has to be coordinated. The appraiser has to get the appraisal done quickly, the file has to be put together fast and accurately, and the documentation has to be collected up-front.

That’s where the borrower has control. If you need to close on a mortgage in a hurry, here are some things you can do to help yourself:

1. Get pre-approved ahead of time – once you have a contract with a fast approaching closing date, it’s too late to think of the things you should have done earlier. If you have a few problem spots on your credit, or other weak spots that need to be addressed, knowing what you need to do can put you in a much better position for a fast loan approval.
2. Have your documentation ready – The days of approving a loan based just on your credit score are gone. Having your documentation ready is a key to a fast approval. Having all the documentation at application means that we don’t have to try and get the paperwork in other ways, which slows the process down. Here are some of the things we will need for a normal file:

Current paystubs for the last 30 days for all borrowers.

W2s for the prior two years (2006 and 2007) for all borrowers.

Full tax returns for the last 2 years – only if you are self employed or have substantial commission income.

Bank and investment account statements for the last 2 months (enough to show where the down payment and closing costs are coming from as well as any required reserves) – all pages attached.

A copy of your driver’s license or other picture ID.

This is the minimum documentation. Depending upon your situation we may need more. To get a loan approved and closed quickly we will need to make sure we have what is required for the mortgage guidelines, and we need to address any questions that the underwriter may have. If you are looking for a fast closing, give me a call before you make an offer on a home and I can tell you what else you will need.

1. Have all your addresses and phone numbers – As part of the approval process we need to verify everything on your loan application. Addresses and phone numbers for both your current and past (if in the last 2 years) employers and if you are renting, your landlords.
2. Address any problems early – If you are buying with an FHA loan and you have had any late pays or credit problems in the last 2 years, we will need a letter explaining why it happened. If there are large deposits in any of your bank or asset accounts, we will need to know where the money came from and show a paper trail. Providing this information up-front saves time and helps speed the process.
3. Be prepared – The underwriter is the person who makes the final decision on the loan. If they issue an approval with conditions (things they need before the loan can close) be prepared to get the items needed as quickly as possible. Any thing that is listed as a pre-closing condition means the underwriter has to look at and sign off on these items before the property can go to closing.

You can close on a loan quickly, but you need to plan ahead. Working with your loan officer and having what you need takes away some of the stress and makes for a quicker, smoother closing.

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