Buying a home during the holidays can be a great way to find a fabulous deal. Sellers who list during the holidays are often quite motivated, you may benefit from tax deductions, and everyone involved is often incentivized to help move the transaction along quickly so they can close out their year.
Whether you just started your home search or are nearing the closing table, here are 9 tried and true ways you can speed up the mortgage process to ensure you’re sipping hot chocolate and wrapping presents in your own home this holiday season.
Best of all? None of them will disrupt your holiday cheer!
#1. Know Your Creditworthiness
Nothing can make a mortgage approval drag on more than financial hiccups like late payments, bankruptcies or questionable credit. Catch these issues before they become a problem by ordering a copy of your credit report. When reviewing it with a fine-tooth comb, reach out to the bureau or your creditors if you see anything that’s inaccurate.
If you have issues that you can’t fix in the short term, talk to your mortgage professional about them at the very beginning of the process.
#2. Prep Your Paperwork
Yes, applying for a mortgage can require a mountain of paperwork, which can be hugely time consuming. To speed up the process, make sure you have some (or all) of these documents handy prior to applying:
- Pay stubs for the last 30 days
- Profit and Loss statement (if you’re self-employed)
- W-2s or federal tax returns for the past 2 years
- Bank and investment account statements for the past 90 days
- Current statements for any loans or outstanding debt
- Residency information for the past 2 years
- Your driver’s license or a photo ID and your Social Security Number
- Explanation of any credit anomalies
- Proof of any supplemental income
- Copy of a divorce decree, if applicable
#3. Practice Transparency
Talking about your credit and financial situation can make anyone feel a little awkward, but the more information you share with your mortgage professional, the more likely it is that they can find and close a loan for you. As mentioned in #1, be sure to share any credit hiccups —if undisclosed, it can derail your approval and add a lot of time to your closing process.
#4. Use the Right Tools
Mortgage platforms have come a long way in the past few years. In fact, technology is helping to improve closing times in the industry. As of February 2015, banks required an average of 40 days to process, approve and fund a purchase loan, whereas a year ago, that number was 42.
Tools like SindeoOne allow homebuyers to shop and compare over 1000 loan programs by filling out a single application in just 5-minutes. How’s that for speeding along the process?
#5. Get Preapproved
When you get preapproved for your mortgage, you can often cut a week or more off the process —simply because much of the legwork is already complete. What’s more, a preapproval letter can show sellers that you’re serious and vetted in the process, which can help them make a faster decision when accepting or negotiating your offer.
#6. Be Disciplined
Other moves that can derail the mortgage process are applying for new credit, taking on an auto loan, making large purchases, or even switching banks. While these may seem like harmless financial moves, when done during the loan process they can raise eyebrows. Practice financial discipline. Wait to purchase top-of-the-line appliances or a car for that new garage until after you’ve closed the deal.
#7. Communicate Effectively
There’s a lot of back and forth during the mortgage process. There will undoubtedly be paperwork you need to track down, phone calls and emails that need responses, and more. Make sure you’re making it a priority to respond to all communications from your lender without delay. When both the lender and the borrower are working together, valuable time can be shaved off the process.
#8. Pre-Plan Your Move
You’re almost to the closing table. Save time in the home stretch by pre-planning your move. Organize move-in day by lining up movers, utilities, babysitters, and other players in advance —it will make for a much smoother and stress-free moving day.
#9. Be Flexible for Closing
The closing is the final step in completing the mortgage process. Because this is where you’ll sign financial documents and take legal ownership of your new home, there are a handful of players that will need to be present (including you, any co-borrower, an escrow officer, your real estate agent, and often the seller and their agent). Try not to play “calendar bingo” by being flexible when scheduling the official closing.
Getting Started
Don’t spend the holidays wishing that you were in your new home! Make it happen by following these tips and by connecting with our team at Sindeo.
Already own a home? Here’s how refinancing can help you save for the holidays.