On average, banks process loan applications three days faster compared to 2013. In March and April this year, we waited for the loan for about 30 days. However, in the same period last year it was about 33 days. Banks have accelerated and are analyzing mortgage applications faster.
Getting a loan is a time-consuming process
It is true that sometimes it is possible to get a decision and sign a loan agreement in a week, but usually it takes much longer. On average, it takes more than 30 days from submitting a loan application to signing a loan agreement.
The period of waiting for a loan has been practically unchanged for many months. In January and February this year, we observed a slightly extended period, and several factors contributed to this. The main one is the introduction from January 2014 of a new Good Finance and the end of loans for 100 percent of the property value.
For this reason, many people who did not have a down payment submitted their loan applications in December last year to obtain 100 percent funding. Such a large number of applications in many banks translated into extended document analysis times for potential borrowers.
The second factor determining the extension
Of the waiting time for granting a housing loan in January this year is more prosaic, and it is a large number of days off from work at the turn of December and January. In the period from Christmas to the Epiphany, in many areas we observe a certain slowdown in activity every year, it is also a period of increased holidays. These factors resulted in slower analyzes and longer credit waiting times. In the following months it can be said that everything has returned to normal and then to get a loan you should wait about one month.
Credit application analysis is a multi-stage process. From the moment of submitting the application, the bank must verify the source and amount of the client’s income, credit history and current financial liabilities. Real estate valuation is also a process that takes at least a few days.
Month of the analysis – what does the bank do then?
The bank must commission it to an appraiser, or send its own representative. Even if the client presents his valuation with the loan application, the bank still has to verify it. It is also worth remembering that at each stage of the analysis we may be asked to provide additional documents confirming the ambiguities that have arisen.
Any such inquiry by the bank also extends the analysis time. For this reason, it is extremely important that the loan application is complete.
The physical writing of the contract is also a stage that can extend the time to sign the contract. In most institutions, this process is almost automatic and the corresponding document is generated almost immediately. However, it takes several days to complete a standard contract in several banks, and this should also be taken into account.