Acquiring a mortgage can be a time-consuming process, so it’s best to take necessary measures to ensure nothing stands in the way of closing. Hopefully you never experience any roadblocks of your own, but it’s wise to stay aware of what can cause a delay in obtaining a mortgage.

  1. Cloud on title

    During the closing process, the title agency looks for issues that make the title of the home unclear. When a title is deemed doubtful, a cloud is put on it. This can delay the mortgage process significantly because it takes legal action to resolve it.

  1. Bad credit? No credit? Big problem!

    Having questionable or bad credit history can make getting approved and receiving a loan much more complicated. Bad credit will lengthen the mortgage process because many lenders require additional verification to establish financial stability.

  1. Type of mortgage

    Based on the type of mortgage you are trying to acquire, the mortgage process can be longer or shorter than average. Conventional mortgages typically take three to four weeks to process while FHA and VA mortgages take about six weeks or longer.

  1. Human error

    Since all documents are handled by humans, it’s possible and common for mistakes to be made from time to time. Misplaced paperwork, procrastination, miscommunication, and de-prioritization are just a couple ways human error can occur.

  1. Errors in documents

    Providing correct information on documents is a crucial part of obtaining a mortgage; this includes correct names, decimal places, information and correct paperwork. If records do not equally match when the underwriter reviews the loan material, the process will quickly come to a halt.

  1. Time of year

    The time of year is important when applying for a loan, as federal holidays and additional absences will lengthen the process. If you can, avoiding closing at or around a holiday.

  1. Insurance issues

    If a home is found to have problems with insurance, the closing process will come to an automatic stop. Trying to work with the insurance company or evaluating your finances can often lengthen the process.

  1. New debt

    Taking on new debt such as a credit card or new car payment can often make an individual appear as a risky investment to a lender. Since mortgage approvals are partially based on debt-to-income ratio, adding unnecessary debt to your name can often halt the closing process.

  1. Appraisal problems

    A low appraisal can cause a loan to be declined because many lenders aren’t willing to offer a loan that is worth more than the home in question. More negotiation will be required which will add to the process often lengthening it.

  1. Instability

    Switching jobs or moving from a job that provides a salary to commission can hurt your chances of approval. Failing to maintain stability can delay the closing process. This is why lenders often look for stability in the people they are investing in.

Be sure to not let these things stand in the way of you getting the house of your dreams! To get a head start on your mortgage loan, call Union Home Mortgage at 1.800.767.4684 or visit Union Home Mortgage for more information!