Most of us are familiar with the process that mortgage lenders take to verify the potential home-buyer’s assets prior to granting them a home loan, commonly referred to as underwriting. This process usually takes around 2 weeks to complete. This article will briefly explain: (1) what underwriting entails, (2) what the underwriter reviews in order to verify your assets, and (3) how can you speed the process up.
The underwriting process begins as soon as you close on a house, therefore timing the underwriting process is incredibly important if you have a date that you would like to move in by (say before school starts for your children). There is no way to avoid the underwriting process, since it is required before a lender will grant you the necessary funds for the purchase of your new home.
1. Underwriting, what is it?
In general, a mortgage officer will review the potential buyer’s paystubs, tax forms, and other documents prior to approving a buyer’s pre-qualification. The underwriting process is far more involved, going through the nitty-gritty details of a potential home buyer’s assets to determine their financial strength. The underwriter combs through every deposit, credit report, and other forms to determine whether you are a safe bet for them to grant you a loan. In short, the underwriter is tasked with ensuring that you satisfy the lender’s requirements by confirming your assets and assessing your financial strength.
2. Underwriting, what do they look at?
The documents the underwriter will review vary depending on the loan you are receiving; for example, if you are seeking an FHA loan, you will be required to submit substantially more paperwork. Generally, though, you can expect to turn over your paystubs, bank statements, and all your tax returns to your underwriter. Further, you should be prepared to turn over additional documentation anytime your underwriter asks you a question – they can’t just take your word for it.
3. Underwriting, how do I Speed it up?
If you want the process to go quickly, preparation is the name of the game. Make sure you have paperwork supporting each and every asset you have, as well as each and every liability you have. If you provide your underwriter with everything they need before they have to ask for it, the process can be very quick – sometimes as little as a single day!
At the Chernov Team we take pride in informing our clients of the nuances of buying and selling a home and helping them navigate an incredibly complicated process. The Chernov Team understands that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most.