It's taking forever!

You’d think that all the new automation in mortgage lending would make things easier, right? Faster? More efficient? It’s not the case, and here’s why.

Back in the day, not so long ago but before the internet was widely available, we had to handwrite the four-page loan application data and manually type the final loan docs. The local messenger service came by twice a day because this was even before fax machines. Files got pretty thick because we manually verified everything with mailed forms to the bank, the employer, and the credit bureaus.

Today, you could easily type in an online mortgage application if you awake in the middle of the night. Poof! You’re approved for a home loan. Great – but what happens after that?

Your underwriting team runs your file through the Interthinx Company service called FraudGUARD. This produces a report 40-50 pages in length, that forward- and reverse-verifies every piece of data on the application. For every bit of data that does not exactly match, you get a loan condition to explain and document the difference.

To boot, recently a new service has come about called Collateral Underwriter. This is a Fannie Mae service which dumps your new property appraisal into a database, where every field is compared to all available prior data about the property. Apparently the results are coming back with “variances” which are not further identified. The underwriter is then required to manually compare the current report with the CU report line-by-line, until the discrepancy can be resolved and satisfactorily supported.

Add to that high loan volumes due to good interest rates and rising market values, and you have the perfect storm. At present, a 30-day close is almost impossible, and borrowers are being driven crazy with demands for further (and even more!) documentation.

What’s a buyer or seller or refinancer to do? Make sure your Realtor has a good rapport with your lender, and be certain to ask up-front about what is a realistic expectation for your closing time. Know what happens if you exceed the date of your rate lock. And settle in, because at the end of the day you’ll have the pride of ownership called the American Dream.

Tammy Engel is your local Mortgage Advisor and has been working for your best interest since 1990. Contact her at 661/822-7325 for purchase, refinance, and reverse mortgage.