Changing Lenders During The Mortgage Process
This guide covers changing lenders during the mortgage process. Is changing lenders during the mortgage process a good idea? You want to avoid changing lenders during the mortgage process if at all possible. Changing lenders during the mortgage process will cause delays in closing on your home loan.
Our mission at Gustan Cho Associates is 100% of all our pre-approval letters will not just close but closes on time. There will be no last-minute hiccups where changing lenders during the mortgage process is unnecessary for any of my borrowers.Many borrowers become unhappy with either the services of the mortgage loan originator or the policies of the mortgage underwriting process of their lender. They get fed up and want to change lenders. Changing lenders during the mortgage process is the only option.
How Can Changing Lenders During The Mortgage Process Be Done?
Reasons Why Borrowers Want To Change Lenders During The Loan Process
Mortgage loan officers not returning their phone calls is one of the biggest reasons many borrowers change lenders during the mortgage approval process. Another reason borrowers change lenders is that the mortgage processor or underwriter repeatedly asks for the same conditions. Or after the borrower turns in mortgage conditions and the underwriter returns with more conditions. However, changing lenders during the mortgage process is necessary when a mortgage underwriter issues a mortgage loan denial. This is because the borrower was not properly pre-approved by the mortgage loan officer in the first place.Changing Lenders During Mortgage Process Due To Loan Denial
Unfortunately, not all mortgage loan officers diligently qualify a home buyer before issuing a pre-approval letter. The pre-approval stage of the mortgage process is hands down the most important part of the mortgage approval process. Borrowers get a last-minute mortgage loan denial because the loan originator failed to qualify borrowers properly.Changing Lenders During Mortgage Process Due To Underwriter Mistakes
Unfortunately, mortgage loan originators are human. They can make mistakes. But all mortgage loan officers must realize they have a huge responsibility. This is because many lives are at stake if they do not properly qualify as a home buyer. The homebuyer and their families are affected, and the home sellers.The home sellers often depend on the home buyer in closing on their home, and they already may have another home under contract, have all of their belongings packed, and have theirs. Children registered at the new school. Same with the home buyer.Homebuyers probably already told their landlord that they are vacating their rental home. Many have signed up their children to their new school districts. Others have packed up their belongings. Many made plans to move by ordering new utilities. Many are giving final notices to their utility companies that they are vacating their rental apartment or home. As a loan officer, I ensure that every pre-approval letter that either of our loan officers issues is rock solid.
What Are The Steps In Changing Lenders During The Home Loan Process?
If you get a last-minute mortgage denial by your current lender, find another one that can do your mortgage loan, get it approved, and close. Chances are you will need an extension of your real estate purchase contract. Most home sellers will understand that you will need more time if you change lenders during the mortgage process. Normally, a 30-day extension to the real estate purchase contract is recommended. However, most lenders like myself will expedite the mortgage approval process for borrowers who are changing lenders during the mortgage approval process.Transferring Home Appraisals
FHA mortgage borrowers who had an FHA Appraisal done with a prior mortgage lender can transfer their FHA Home Appraisal to the new mortgage lender so they do not have to pay another FHA Appraisal. The new lender will need to restart the mortgage application and approval process.New Lender will need all the documents you provided your old mortgage lender all over again, New credit needs to be pulled because we cannot transfer credit scores and cannot use the credit report used by the old lender. The mortgage loan file will be processed and submitted to underwriting with the new mortgage lender.Once you get a conditional mortgage loan approval, you will need to get the conditions cleared, and once the conditions are cleared, your mortgage loan file will get issued a clear to close, which means that the mortgage lender is ready to fund the mortgage loan. The closing department of your new mortgage company will arrange the mortgage loan closing with the title company. If real estate attorneys are used, the title company will coordinate the closing date with buyers, sellers, or attorneys.
Reasons For Changing Lenders During The Loan Process
I often recommend to borrowers who contact me about changing lenders during the home loan process to stay with the current mortgage lender they are dealing with if possible.Unless the mortgage company is stressing you out due to no return calls, constantly giving you more conditions after conditions, or you get a mortgage loan denial, working with your current mortgage lender is always recommended.However, if you are getting the runaround and changing lenders during the mortgage process is necessary, please get in touch with me at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com. Gustan Cho Associates is available seven days a week, evenings, weekends, and holidays to take your phone call and answer any questions you may have.
