One weekend when I was on call for weekend leads, a borrower called me while he was shopping for groceries. I was able to effectively pre-approve him in about 15 minutes. I emailed a pre-approval letter to him and his agent, and 15 days later he owned a house (literally; the entire process went like clockwork).
That was possible b/c the borrower was tech savvy (able to send me documents from his phone), and he had no debt, perfect credit, a salaried job with a well-seasoned bonus history, low debt ratios, and a 20% down payment that had been sitting in the same account for months.
Borrowers as simple and as clean as in the example above represent about 5% of our borrowers. The vast majority of our borrowers have issues of some sort – such as unexplained deposits, unseasoned gift funds, restricted stock units, credit problems, or exceptionally complex tax returns.
Even the simplest pre-approval can take up to an hour – to formally set up the file, to sift through and verify all the documentation, to send follow up scenarios and information, etc. Our more complex files take as long as three hours.
Accurate pre-approvals take so much time b/c we want to make sure we miss nothing that might blow up a transaction later on. We want sellers and listing agents to be able to 100% rely on our pre-approvals.
When some institutions claim they can “pre-approve borrowers in minutes…” they are actually referring to “pre-qualifications” that are utterly unreliable.
B/c of the total time pre-approvals require, we quote 24 to 48 hours for them. But, we are happy to do them in four hours on occasion, if necessary.
All we ask is that borrowers and agents alike appreciate the effort that goes into them.
Jay Voorhees at (925) 855-4491
Real Estate Broker, CA Bureau of Real Estate, BRE# 01524255, NMLS# 335646