In theory, you could close a mortgage within a couple of days of the application. However, lenders have to gather and verify significant amounts of information prior to formally approving a loan and it usually takes at least 30 days to complete the home loan process. If you, your lender and other related parties work well together, you can sometimes close a mortgage within 15 days.
Home appraisals are usually the single biggest reason for delays in the mortgage underwriting process. Lenders have to hire state certified appraisers to conduct these appraisals and due to a heavy workload, it can take weeks for an appraiser to even visit your home. However, if your lender can find an appraiser who can conduct the appraisal at short notice, then you could have the report back within just a few days. Alternatively, lenders sometimes accept appraisals that are less than one year old so if you had your home assessed within the last 12 months then see if you can use that same appraisal.
Title And Flood
Prior to approving a loan, your lender must determine whether your home sits in a federally designated flood zone and whether you actually own the property. Lenders hire vendors to conduct a flood search and a title check. Flood search vendors can quickly access federal databases so if you give your parcel address to the lender you can receive the flood search result the same day. If you are in a flood zone you can also buy flood insurance the same day. The title search involves checking though court records so it normally takes at least a few days but encourage your lender to use the title company offering the quickest turnaround time.
Lenders typically allow you to submit a loan application with minimal information upfront and then send out a list of the supporting documentation needed to process the loan about three days after you submit your application. However, your lender can tell what documents you need right from the outset and if you submit everything on day one, then you speed up the whole process. Typically, you need to submit documents such as your last two years W-2's, your warranty deed, two year's of tax returns, two months of bank statements, homeowners insurance declaration page and a survey of your property.
Minor obstacles can cause major delays during the mortgage underwriting process but you can minimize the impact of any unforeseen problems by staying in frequent contact with your lender. Give your lender your email, cell phone number and home number so you can answer any questions that arise without delay. Unforeseen issues could result in the mortgage process taking more than 15 days but if you have an existing appraisal and submit your documents on day one, then you have a very good chance of closing your loan in two weeks or less.