How long a loan takes to close is certainly different when there is a refinance boom of sorts. Then every mortgage broker or banker has to contend with longer turn times particularly with Underwriting and appraisals. However, many brokers or bankers have plans in place to still fund purchase loans within required timelines during those busy times. Perhaps all the increased regulations and paperwork to follow slowed things down to some extent for many lenders some years back, but most have really gotten their operations down to not let that slow them down so much anymore. Timelines for when a mortgage loan is entered to when it funds still will vary from the capabilities of one individual loan officer and a particular lender to another individual loan officer and particular lender.
With all the new checks and balances involved in the loan process (not ordering appraisal without intent to proceed, getting IRS tax transcripts on every file, waiting three days to close after appraisal received, etc) it’s certainly taking longer to close in many cases. Larry’s correct that volume, in addition to regulatory concerns, impacts the time to close, but if volume were taken out of the equation, I’d say it takes a few days longer now, than before QM and other reforms were enacted.
The amount of time required to close the average mortgage loan has gone up significantly since the recent Frank / Dodd Financial reforms laws went into effect (AND SO HAS CLOSING COSTS). All the new requirements have added significant burden to lenders with little meaningful benefit to home buyers.
I usually tell my mortgage clients to figure about 30-days from the time they sign the application and have given me all their initial basic documentation (pay stubs, W2’s, etc).
This time can be shorter or longer based on a bunch of variables. For example, the client is slow to get the lender requested documents. Surprises that pop up during the process, and how long does it take for the appraiser to get their job done. My office is in St Paul, MN – getting an appraisal in the Minneapolis or St Paul area is fairly quick. Usually about a week. But I just closed a loan in rural South Dakota that took almost 30-days just to get the appraisal.