Congratulations you’ve made it through the mortgage underwriting process! But now you’re probably wondering “How long does it take after underwriting to close on my house?”
The good news is, the finish line is in sight Typically, it takes 3-4 weeks to close on your mortgage after you’re cleared to close (CTC) However, this timeline can vary depending on a few factors, such as:
- The complexity of your loan: If you have a straightforward loan with no unusual circumstances, the closing process can move along quickly. However, if you have a more complex loan, such as a jumbo loan or a loan with a second mortgage, it may take a little longer to close.
- The responsiveness of all parties involved: The closing process involves several parties, including the buyer, seller, lender, title company, and attorney. If everyone is responsive and gets their paperwork in on time, the closing can happen quickly. However, if there are delays on any side, it can push back the closing date.
- The availability of funds: The buyer needs to have the funds available to close on the loan. If the buyer is waiting for a wire transfer or another form of payment, it can delay the closing.
What Happens After You’re Cleared to Close?
Once you’re cleared to close your lender will send you a Closing Disclosure. This document outlines the terms and conditions of your loan, including the loan amount, interest rate monthly payment, closing costs, and the total amount of cash you’ll need to bring to closing. You’ll have at least 3 days to review the Closing Disclosure before closing.
At the closing, you’ll sign all of the paperwork for your loan and officially become a homeowner. You’ll also need to bring the funds to cover your down payment, closing costs, and any other fees associated with the loan.
Tips for a Smooth Closing
Here are a few tips to help ensure a smooth closing:
- Be prepared: Make sure you have all of your paperwork in order, including your driver’s license, Social Security number, and proof of income.
- Communicate with your lender: Let your lender know if there are any changes to your financial situation, such as a new job or a change in income.
- Ask questions: If you don’t understand something, ask your lender to explain it to you.
- Be patient: The closing process can take a few hours, so be prepared to be patient.
Closing on your mortgage is an exciting time, but it can also be stressful. By understanding the timeline and being prepared, you can help ensure that the process goes smoothly.
Bonus: Here are some additional resources that you may find helpful:
- Rocket Mortgage: How Long From Underwriting to Closing?
- Rocket Mortgage: Clear to Close: What to Expect and What Happens Next
- NerdWallet: How Long Does It Take to Close on a House?
What happens after Closing Disclosure?
A Closing Disclosure must be provided by mortgage lenders to you at least three business days prior to your closing date, per federal law.
You must compare the CD form you receive with the Loan Estimate you were given when you submitted your mortgage application.
Certain fees that are included in your Loan Estimate, like the origination and appraisal fees, shouldn’t ever be altered on your Closing Disclosure.
If these fees have changed, contact your loan officer and ask for a cost correction. Even a 0. A 25% increase in your loan origination fee can have a significant effect on your closing costs because this fee is based on the amount of your loan.
Lender fees shouldn’t increase between your LE and CD, but other costs listed on your CD can increase.
Some can increase by up to 10% while others can increase by any amount.
- Can increase by as much as 2010 percent: these include fees for surveys, title searches, and pest control. The lender has no direct control over the costs of these services because they are rendered by outside parties.
- Can increase by any amount: Some expenses may rise dramatically between your LE and CD depending on the specifics of your loan. For instance, your homeowners insurance company might demand an upfront payment. Or you may need to pay property taxes in advance. Delays in your closing day could increase some costs, too.
Make sure you inquire about any cost increases you notice on your CD with your loan officer or closing attorney.
Particularly if you locked in your rate early in the loan process, the interest rate on your Closing Disclosure should match the rate on your pre-approval or Loan Estimate.
In fact, it’s illegal for lenders to underestimate rates and fees on a Loan Estimate only to surprise you with higher costs on the Closing Disclosure, according to the Consumer Financial Protection Bureau.
Even so, your interest rate could still go up if:
- Your financial situation changes: The lender may raise your rate or cancel your eligibility if your credit score declines or if you lose your job.
- When your rate lock expires, closing delays may force you to lock in a new rate, though rate lock extensions frequently avoid this.
- You switch loan programs: For instance, you would probably see different rates if you chose to obtain a conventional loan rather than an FHA loan.
- The home’s appraisal was low: A low appraisal modifies your loan-to-value ratio (LTV), which may have an impact on your eligibility for a mortgage or on mortgage rates.
- Your debt-to-income ratio may increase if underwriters are unable to confirm your overtime or side income, as your lender was unable to verify everything. This could cause an increase in your rate.
- You modified the loan’s terms: Your rate would increase if you chose to put down less money or switch to a 30-year term from a 15-year one.
Obtain a reasonable time estimate from your lender regarding the loan closing process before committing to a mortgage rate.
One of the greatest strategies to guard against unexpected rate increases on your new loan is to select a long enough rate lock period.
What happens after underwriting?
It’s a huge accomplishment to receive the mortgage underwriter’s final approval, but it’s not quite time to celebrate.
You’ll go through a few more steps before you get the keys to your new place.
The lender has to double-check your income and employment. And you still have to sign final documents and pay closing costs.
Learn exactly what needs to happen after final approval to put your home sale over the finish line.
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How long does it take for the underwriter to make a decision?
FAQ
How long does it take for the underwriter to make a decision?
What happens between underwriting and clear to close?
Can a loan fall through after underwriting?
What is the final stage in the underwriting process?
How long does it take to move from underwriting to closing?
Underwriters will not only look at the documents you’ve submitted, but they’ll also further inspect the details surrounding your income, credit history, DTI, assets, and the amount and type of loan you’ve requested. Working through each step is part of the reason why it can take 30 – 45 days on average to move from underwriting to closing.
How long does mortgage underwriting take?
Much of this work happens during underwriting. If the underwriter encounters issues, this can delay your closing. How long does the underwriting process typically take? Underwriting can take a few days to a few weeks before you’ll be cleared to close. What Determines How Long Mortgage Underwriting Takes?
How long does underwriting take for a refinance?
The underwriting process for a refinance follows the same steps as the underwriting process for a new loan. It can take anywhere from several days to several weeks to complete underwriting, depending on yours and the lender’s circumstances. What should I do if my loan application is denied during underwriting?
How long does it take to close on a mortgage?
Keep in mind, however, that underwriting is just one part of the overall lending process. You can expect to completely close on a loan in 40-50 days. The average new-purchase mortgage took 47 days to close in Jan. 2024, according to ICE Mortgage Technology . 1. Getting preapproved