Once the Applicant has submitted their application, financials, etc., the Lending Institution will issue a loan commitment which outlines any outstanding loan conditions/requirements. The loan commitment is a contractual obligation and the time frame of the Purchase Agreement should be observed accordingly.
A final loan approval will be issued once all conditions are cleared. The Lending Institution will provide the Settlement Agent and Applicant with a time frame for closing and finalize any quality control processes. Quality Control, commonly referred to as “QC”, is the final process of a loan application wherein the Lending Institution conducts an audit of the file.
Once a closing date has been confirmed, the Lending Institution will deliver to the Settlement Agent the closing instructions. These closing instructions are the guideline by which the Settlement Agent will prepare the HUD-1 Settlement Statement. Lender approval of the HUD-1 is required.
Upon approval of the HUD-1, the Lending Institution will release the loan package to the Settlement Agent.
Lender funds are typically wired to the Settlement Agent the day of closing. The Lending Institution approved HUD-1 and funds are a prerequisite to any closing.
Once the loan package is signed at the closing table, the Settlement Agent will be required to fax/email funding documents from the closing table and obtain funding authorization from the Lending Institution.
The original loan package must be returned to the Lending Institution within 24 hours of closing.
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