How Long Does a Mortgage Audit Take

It can take as little as two to three days to complete the mortgage audit process, which mortgage lenders use to verify your assets, check your credit, and examine your tax records before approving a home loan. However, it normally takes a loan officer or lender longer than a week to complete the process.

A forensic audit, commonly referred to as a mortgage loan audit, looks into the conditions of your mortgage to see if the loan is valid. According to forensic auditors, you can force a loan modification in your favor or cancel the loan entirely if there is an issue with the mortgage. This procedure’s simplicity is influenced by a number of factors, including an auditor’s workload and availability. Usually, an audit takes up to two weeks.

After the down payment is completed but before the closing on the house, the mortgage audit procedure takes place. This implies that the timing of this mortgage application procedure can be important, especially if you want to move in by a specific date.

But make no mistake: You cannot dodge the mortgage audit procedure. Before the mortgage lender commits to providing you with the funds for a purchase, all loans and loan applications must pass a mortgage audit process.

Even if you communicate with your mortgage officer or bank lender on a daily basis, the mortgage audit process will still be drawn-out and possibly upsetting.

What to know about the timing of the mortgage audit process

There is no computerized mortgage audit for mortgages. A list of the necessary documentation will be supplied to you. The timeline may be impacted by how quickly you can deliver it. Here is all the information you need to know about the mortgage audit timetable, as well as some tips on how to shorten it and explanations for why it takes so long.

What steps comprise the mortgage audit procedure?

Although it would be convenient, this is not how pre-approval works with loan lenders. The initial stage involves making the down payment. After making that payment, assemble your supporting documents and submit them.

Before providing buyers with a pre-qualification, your mortgage officer or loan officer usually checks their tax returns, pay stubs, bankruptcy records, debt-to-income (DTI) ratio, liens on any properties you own, and other fundamental papers.

To guarantee your creditworthiness, a mortgage audit for a house loan goes through each form, deposit, and credit report with a fine-tooth comb. An underwriter’s responsibility is to confirm and evaluate your DTI and creditworthiness to ensure you comply with the lender’s requirements.

The mortgage audit procedure happens behind closed doors, but most of the mortgage loan process is very open. Some consumers have perfect credit histories, but others need a more profound investigation to learn more about your credit history. Even after you submit your paperwork, it’s likely that a bank employee or a lender will ask you for further information or more papers.

What types of documents does a mortgage review?

Depending on the type of loan you are obtaining from your lender or underwriter, additional documentation may be required for your loan application (an FHA loan, for example, often requires more paperwork). As part of the mortgage audit process, be prepared to supply your tax returns, credit reports, W-2s, bank statements, and pay stubs.

Every time an underwriter or lender has a query, you may anticipate having to send more supporting papers. Your bank statement, for instance, might reflect a recent $2,000 deposit. Although you know it is your cherished grandmother’s birthday present, the underwriter will want to know where the funds originated. You’ll probably need to provide your lender with a letter of justification explaining that it was a gift.

Because the questions may seem apparent to you, a mortgage audit can be frustrating. Please don’t take it personally; many underwriters and lenders also find the mortgage loan procedure tedious, but it is part of their job description.

Underwriters routinely over-request documents to cover their asses rather than being confident in their choice and moving on because they are afraid of having a loan audited and obtaining a poor score.

How quickly can a mortgage audit be completed? How long does it typically take?

How do you know how long a loan mortgage audit takes and if you can speed it up? Ensuring your paperwork is complete for the lender or underwriter is the greatest way to expedite the procedure. If you have everything in order and have strong supporting evidence, your loan might be approved in as little as two to three days—or, if you’re lucky, even in just one.

Expect to wait at least a week for the underwriter to grant a “conditional approval” if more documentation is needed, as is the case for the great majority of loans, even for borrowers with excellent credit.

Although the mortgage audit procedure can be annoying, keep in mind that the end is in sight. You should be close to receiving final approval, possibly conditional approval, if the underwriter requests a few more documents.

HUD

A federally licensed counselor can give you information to prevent foreclosure if you’re looking for a mortgage loan audit to discuss improved payment conditions with your lender. The HUD agent can tell you if you’re eligible for lower monthly payments under the Homeowner Affordability and Stability Plan. The same information is provided via foreclosure prevention counseling, which is free, and you can take advantage of it anytime.

Filing a lawsuit

Advocates for mortgage loan audits claim that the majority of mortgages have a legal problem that offers the homeowner leverage to negotiate a lower interest rate. However, Lisa Madigan, the attorney general of Illinois, asserted in 2012, “An audit can virtually never be utilized to negotiate a lower rate with your lender.” Although numerous mistakes in mortgages have been discovered, a homeowner seeking to hold the lender accountable through a formal, enforceable legal process must go through the court system, which can be costly.