Craig Ackerman discusses why Financing contingencies are important
|This Month||Average: N/A, Votes: 0|
|All Time||Average: 4.00, Votes: 1|
Flagging for Review
We often get asked, “Why do I need a financing contingency if I’m already approved as a buyer?” Well, the final confirmation for financing will always require documents that are only available after a contract is signed, here’s why:
While a properly conducted mortgage pre-approval will examine the credit scores of a buyer, their assets, including their cash reserves for making the down payment, and income verification of their current employer. Final loan approval is always subject to documents that are only made available after the offer has been made. So, for instance, lender will want to see the purchase contract and all the addendums attached to it, the preliminary title report for the subject property and the appraisal for the subject property, determining its value.
Final loan approval usually takes between ten days to fifteen days after purchase contract has been ratified. It’s important to use the financing contingency to protect you, the buyer, in the unlikely event that there are issues that prevent you form closing.