Cutting Close
Some lenders are now shooting for a 21-day turnaround to close home loans. That would be a major reduction from the current time-to-close, which hovers around six weeks.
Closing times bloated after the housing crisis, and there doesn’t seem to be any indication of them shrinking. The number of days to close for purchases averaged a little over 47 days in 2016, showing no real reduction in time from the year before, according to mortgage origination system servicer Ellie Mae.
But National Mortgage News says that lenders are starting to push for the three-week close. National lender CrossCountry Mortgage Inc. in Brecksville, Ohio, and California lender FirstCal are training staff to meet that target, in part to attract REALTORS® and, by extension, buyers and sellers looking to close faster.
Companies are retooling their operations and training staff with the hope of meeting the 21-day goal for closing home loans. Loan volumes have been falling and lenders have largely sorted out the implementation of major new regulations, so they have more time to focus on integrating the technology and strategies needed to reduce the time spent on certain steps of the process. CrossCountry, for example, is also getting buyers on board by asking them to commit to the 21-day timeline as well, National Mortgage News reports.
However, hurdles exist, particularly appraisals—an ongoing appraiser shortage and unpredictable appraisals sometimes hobble the process, according to the National Mortgage News.
