My mortgage broker told me she's waiting on the "clear to close". What does that mean exactly?

I was told we were pre-approved. Then that we were approved. I thought it had already gone through underwriting. Can someone help? I need to know the process in layman's terms!

8 Answers

Relevance
  • 1 decade ago
    Favorite Answer

    Pre-approval just means the amount you want to borrow has been OK'd.

    The clear to close means all the other things needed to close have been taken care of.

    Things like:

    1. appraisal of your property (to make sure they aren't lending you more than it's worth)

    2. Check of the city for leins. Meaning there aren't any outstanding judgements on your property placed by people you owe money to.

    3. inspection of your property (to make sure it has no structural problems you might not be aware of.) They would not want to lend money on a house about to collapse.

    4. survey from the city. To make sure their legal description of the property matches what you think you are buying. That way they don't lend you money to buy something a portion of which is legally someone elses.

    • Login to reply the answers
  • Anonymous
    6 years ago

    The Pre-Qualification - Provided within minutes of the initial application

    This letter is basically worthless. It means that the borrower has applied for a loan, their credit history has been examined and the lender/broker is relying solely on the information provided by the applicant regarding income, assets and ability to document each. A Pre-Qualification (pre-qual) is only as good as the borrower is honest.

    The Pre-Approval - Provided within minutes of the initial application

    See above (Pre-Qual).

    The Approval - Provided within days of the initial application

    The Approval is a little stronger than the Pre forms listed above in that the borrower has supplied the necessary documentation and satisfied the stipulations according to investor guidelines for a particular loan program. If this is an automated underwriting decision chances are good (very likely) that this loan will close. This is not a 100% certainty however. The underwriter may ask for a desk or field review on the appraisal and the value may be lowered. There may be additional documents required by the QC or Fraud Prevention department at the investor which cannot be produced. Issues with the property or the seller may be discovered during the QC/Fraud Prevention process. This is NOT a done deal.

    Clear-To-Close - Provided within hours of the investor's receipt of the full loan package

    Ah. The magic words. Unless the borrower does something super ignorant like quit their job, change jobs, do something drastic with their credit like buy a new car or boat, this baby is closed as far as the borrower is concerned. There may still be other issues with third parties or an undisclosed law suit or the like but this one is very highly likely to close. Not being able to assign an accurate likelihood to this loan closing I would just say 99.9% so that you get the point.

    What You May Expect

    You, as a seller or real estate professional, may expect your deal to close once the loan application has been stamped with the Clear-To-Close stamp. How long it takes to get that depends on how long it takes to get all the appropriate documentation and information to the investor's underwriting department.

    • Login to reply the answers
  • melia
    Lv 4
    3 years ago

    Clear To Close Mortgage

    • Login to reply the answers
  • Anonymous
    1 decade ago

    She's just waiting for the underwriter to cross all the "T's" and dot all the "I's". It's normal. The term means she knows everything is in place to close the transaction.

    Source(s): appraiser/realtor
    • Login to reply the answers
  • How do you think about the answers? You can sign in to vote the answer.
  • 1 decade ago

    The agent is waiting for the "bring-down" of your credit reports, the approval of the underwriter, mortgage commitment letter and the necessary requirements the Seller must have.

    There will be a final bring-down on the day before or on the day of settlement. This is to make absolutely certain the lender is protected from getting involved in a bad transaction.

    DO NOT borrow any money.

    DO NOT cosign for any one! NOT EVEN parents or siblings.

    Thanks for asking your Q! I enjoyed answering it!

    VTY,

    Ron Berue

    Yes, that is my real last name!

    Source(s): My wonderful family! In the real estate business over 34 years in PA. My wonderful coaches & mentors. Yes, after all these years I continue having them in my corner! THE ABSOLUTE BEST, MOST WONDERFUL real estate investment group in the world, which I was very proud to be a member of! "THE University of Hard Knocks"
    • Login to reply the answers
  • Anonymous
    1 decade ago

    That means that ALL the paperwork is in place - financing, appraisal, inspection, payoff letter from the seller's lender, title search, etc., etc.

    • Login to reply the answers
  • bianca
    Lv 4
    1 decade ago

    simply put- "clear to close" mean OK from the lender to schedule transaction to be finalized-

    • Login to reply the answers
  • 1 decade ago

    probably waiting on the loan or title company.

    • Login to reply the answers
Still have questions? Get your answers by asking now.