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Many Realtors, Loan Officers and Clients are having issues with underwriter turn times in regards to Conventional and (even more so) FHA loans.  Why is this happening?

1. Because of the Sub-prime fall out many more people are going with FHA loans. (They make more sense then going Sub-prime anyway, so it's not a bad thing)  Essentially FHA is taking the place of Sub-prime.  Keep in mind there are only so many HUD approved underwriters that can underwrite an FHA loan.
2. Over the past several weeks FHA has had better rates than conventional A paper (until the past several days).  Also impacting the number of FHA loans being submitted.
3. Have you being watching the news?  The banking industry is hurting, Wachovia just shout down its wholesale mortgage division, along with other lenders having issues and going under, this means the remaining lenders are having to pick up the slack. Thus also increasing the amount of FHA submissions to lenders that are HUD approved.

The above listed influences over the mortgage industry is what's causing your mortgage loans to take so long to underwrite.  So for you Realtors doing business with me and those that hopefully will down the road.  Be patient, this is impacting everyone, set the proper expectations and move on.

If any of you have any thoughts on the matter, feel free to post to this blog or give me a call or email.

Samuel