Timeline - Can we close yesterday ?!?

Ever heard of a loan closing in less than a week? We've done it. Submitted on Monday & closed on Friday. I'm not going to stand here and tell you that it's an easy thing to accomplish, but if all the stars align correctly, it is possible. Even though the majority of deals take longer that 7 days to close, know that lenders want to close a deal just a quickly as borrowers and brokers.

Let's unpack the loan processing / underwriting process and see where the potential pitfalls are and how proactive preparation will only speed a loan to closing.

TODAY- Our Account Executive (AE) gets a call to price out a deal. Within 2 minutes they'll have a PreApproval.pdf document emailed out, inclusive of all information necessary to get the deal submitted into our corporate office for processing.

TOMORROW- Our Account Manager (AM) is going to call and/or email the broker. They're going to be the ones collecting the following required documents:

• 1003 / 1008 - signed by borrower(s)


• GFE, TIL, Borrower's Authorization - signed by borrower(s)


• Credit Report - 30 days or less preferrably


• Appraisal - .PDF, color interior photos, <90>
  
• Signed Terms Letter


• Signed Letter of Net Tangible Benefit - handwritten


• .FNM digital copy of file

Once all of the docs are sent to the AM they'll put together the package and submit it to our corporate office for processing.

Day 1- Our Loan Setup Desk is going to review each file and look for the following items (links are to GMC blog entries pertaining to each subject):

• VALUE - 60-90 day sale price. Recent, Close Proximity, & Bona Fide comps. Property is in good condition, no bullet-proof vest needed to visit, no major repairs necessary.


• EMPLOYMENT - Verifiable employment, benchmarkable income. 50% max DTI


• NTB - True Benefit to the Borrower. Better off after we close the loan than before

Each deal is then color based on findings.

• GREEN - Everything looks good, we order the BPO, send Prior to Doc stips to broker


• YELLOW - Minor issue(s) to overcome. Borrower/Broker asked to pay for BPO (rebated @ closing), Prior to Doc stips sent to the broker.


• ORANGE - More serious issue(s) to overcome. Once issue(s) cleared, stips are sent. Borrower/Broker required to pay for the BPO


• RED - If the deal just doesn't work, a denial letter will be sent with the reason why

DAY 2-5 - We'll get the BPO back and send it to our end-investor for value confirmation. Final value / loan amount / terms will determined and the broker will be notified of these terms for acceptance thereof.

DAY 3-12 - All remaining stips are cleared and the file is sent to underwriting. Any remaining stips are sent to the broker

DAY 10-14 - Deal receives its final CTC, is doc'd out, closes, and funds after the recsission period is up (OO deals).

As you'll notice, there is a lot of wiggle-room in the above timelines and dates. The biggest time savers to get a deal closed quickly are:

• Deal PreScrub. Make sure value, employment, & net tangible benefit are all not going to be an issue.


• BPO Process. Ensure the borrower is aware of the BPO process and that someone will need to come inside to take a few pictures.


• Stip Submission. Be timely with submitting stips back into the office. Most of the delays come from this aspect and momentum is key with these deals.

Most importantly, be responsive. Our entire goal is to either KILL or CLOSE a deal as fast as possible. Understand that no one gets paid to work on a file that dies. We'll do our best to keep the broker updated throughout the process with exactly what we need.

Our focus in the back office is to turn the ORANGE deals to YELLOW and the YELLOW deals to GREEN - with the lion's share of our time spent working on closing the GREEN deals. Any help to make sure that deals fall into the GREEN category from the outset will only help get to get them closed quickly !!