Because of the financial crisis new regulations and tighter underwriting guidelines have slowed down the mortgage process so much that a loan closing within 15 days is something to brag about.
At the height of the boom back in 2006, then-chief economist at the Mortgage Bankers Association, predicted that process engineering could add enough efficiency that by 2016 the industry would be able to close a loan within three days, while others at the time thought it could happen even sooner. Between 1993 and 2003 efficiencies had improved when overall loan processing times had been cut by one-third however by 2006 – with the notoriously loose underwriting and the subsequent crash and reform that followed have since served to lengthen closing times once again.
Historically, the time it took to close was measured from the time the loan was approved, to closing.
We want to start the clock earlier than usual. All is due to making sure we deliver a consistent process each time, starting from appraisal receipt that allows us to remove any variability in timing of appraisal (especially full appraisals) with regards to scheduling. For certain loan programs that do not require an appraisal, the clock can start at submission to underwriting (with all required documents in place), such as FHA Streamline None-Credit Qualifying Refinance. For those requiring an appraisal – it starts after the appraisal is received, which is then submitted to underwriting. Today, we have systems in place to streamline the process bringing our average closing time within 20 days.
6705 Red Road Suite 508 Coral Gables, FL 33143
305.598.9896 (Office)