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The Final Four Things That Could Hold Up Your Client’s Loan

One of the most exciting things about Spring is filling out that NCAA basketball tournament bracket and guessing who the Final Four will be. What’s not nearly as much fun is trying to guess what’s holding up your home mortgage loan on the day of your scheduled closing. A delay in your loan approval can make it difficult to close on a new house. To avoid such complications, you’ll want to know what issues could potentially hold up your mortgage and derail your closing. The following are the final four mortgage problems that most commonly hold up home closings and how you can prevent them from happening:

1. Paperwork Errors

You might be surprised how often a simple error in the mortgage paperwork results in a delay that can last for days. Your paperwork has to be error-free, which means that anything from an incorrect loan amount to a misspelled name can put a wrench in your plans. Fortunately, paperwork errors are easy to avoid as long as you’re diligent.

Carefully go through your loan documents and look for errors ahead of your closing date. You will get your Loan Estimate and Closing Disclosure documents at least three days before your scheduled closing date, which means you should have plenty of time to double check for mistakes. Things that you should double check include all spellings, the loan amount, the down payment amounts, the interest rates and all of your personal information.

2. Down Payment Issues

On the day of the closing, you’ll be required to make your down payment. You can’t just pay with a personal check, which means that you will have to go to your bank the day before to schedule a transfer to the closing agent. However, this transfer could potentially fall through if the money doesn’t get there in time or there’s a bug in the system. You can avoid this potential problem by making the transfer early or by bringing a certified check or cashier’s check to the closing.

3. Unclear Title

One of the tasks that needs to be done by closing is a title search. The point of the title search is to make sure that the property being sold is completely owned by the seller and that they have the legal right to sell it to you. If the title search reveals potential issues, your lender will require that the closing be delayed until they are taken care of. Some of the issues could include the following:

• The seller owes property taxes
• The seller owes money to a contractor for work done on the property
• The property ownership is in dispute as a result of a divorce
• The property is the subject of a lawsuit amongst family members

4. A Walk-Through Problem

It’s standard to do one final walk-through the day before the closing. If you suddenly find a problem with the house that wasn’t there before (for example, if the bathroom ceiling has caved in), the closing will need to be delayed so that you can negotiate the issue with the seller. Make sure you do several walk-throughs of the house before the closing to give yourself time to bring up any problems you find with the seller.

These are the final four things that could hold up your mortgage and delay your closing. If you’ve decided to take advantage of the current all-time low mortgage rates, then make sure to get pre-qualified for a mortgage. To find out how to get pre-qualified for a mortgage, be sure to contact us at Tidewater Mortgage Services today.

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