Why Might a Home Loan Closing be Delayed?

In this GMFS Mortgage video we discuss common reasons a home loan closing might be delayed including failure to properly acknowledge the Closing Disclosure (CD) document, if APR increases over 1.25% or the loan program has to change.

The Closing Disclosure (CD) document, is the most crucial part of the mortgage lending process effecting closing schedule, but it is likely the part least known about by the borrower. That is because most of it happens behind the scenes.

You supply the necessary information and your lending agency prepares the documentation. By law, your mortgage lender cannot provide a copy of the CD directly to anyone except the borrower because the document includes private information such as details about your loan terms.

After the CD is prepared, there are some cases when a closing could be delayed. Previously mentioned, the borrower has to recognize receiving the CD from the lender. Sometimes, this is done in person and many times it is done VIA email. You do not have to provide an actual signature if the documents are emailed.

By opening the email, you acknowledge receipt. If you don’t open the document, that could cause a delay, so look at any emails that are sent to you from your lender.

If the APR increases more than 1.25%, the loan may be delayed or if the loan program changes, for example from a conventional to an FHA loan, that may cause a delay. If there is a significant change required to the CD then regulations require another 3 day waiting period before the closing can occur.

The final CD is in fact prepared by your mortgage lending agency and is sent to the borrower’s title company of choice along with the closing documents. Then and only then, the final CD is signed by the borrower at closing.

 

Read More: How to get a Mortgage PreApproval or to Get PreQualified