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A Step-By-Step Process to Avoid Escrow Delays

A Step-By-Step Process to Avoid Escrow Delays

Contributed by, Giancarlo Corsi of Realty World Legends

Perhaps the most stressful part of escrow is trying to close on time. But you, as the buyer or seller, can help make sure unnecessary delays are avoided.

tips-to-avoid-escrow-delaysFirst and foremost, do not place an offer until your lender has a complete file for you and has run your information through automated underwriting to get a full pre-approval. A pre-qualification is not enough. (Pre-qualification means your lender has looked at all your info and has determined that you should qualify for a loan.) If you are the seller, under no circumstances should you accept an offer without the lender’s automated underwriter approval—unless, of course, it is an all cash offer. Also, as a buyer, make sure your lender updates your file at the start of each month. If it has taken more than a month to have an offer accepted, then your file will be out of date. Ask your lender what he/she needs to keep your file up to date.

Second, make sure the buyer’s lender has ordered the appraisal no later than day 3 from the offer being accepted. Make sure it is scheduled no later than day 6. Make sure it is completed and submitted to the lender no later than day 9. Stay on top of this timeline. Failing to do so is a frequent cause of delays.

Make sure the lender sends the loan file to underwriting no later than day 10 from when the offer was accepted. Remember, the buyer needs to remove contingencies on day 17, and this cannot happen if there is no loan approval by then. Files often take 3 or 4 days to make it through underwriting, and there are almost always conditions placed by the underwriter, which means the file needs to go back to underwriting again, taking several more days. Sometimes the conditions might take several days if not a week to gather or order from a secondary source.

Beyond the loan, the buyer needs to schedule the home inspection for the first 5 days after acceptance of escrow. Yes, the contract allows 17 days to remove this contingency, but why wait? Complete it right away. There may be issues with the home inspection, and you do not want to lose time.

Equally important, get all your paperwork back to the escrow company, the lender, and the realtor within 24 hours of receiving it. Time is of the essence.

Do not let your realtor or your lender tell you not to worry. Make sure they stick to the timeline I have outlined above. Help take control of the process. Be proactive. Be firm, but be nice! And remember, it is your earnest money deposit and the opportunity to purchase your new home on the line here.

Best wishes on a smooth escrow!

Giancarlo Corsi

Realty World Legends

(661) 714-1013

DRE License # 01507740

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