The intent to proceed mortgage is the process of informing your mortgage lender that you intend to go forward with their loan offer. It is your first commitment to your mortgage lender.
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Preparing for your mortgage but not understanding the intent to proceed mortgage?
However, don’t worry. I have got your back. Because in this post, I am going to explain the intent to proceed mortgage along with all the related queries. So, stick here till the end.
Let’s start by finding out the intent to proceed meaning
What Is Intent To Proceed Mortgage?
The intent to proceed mortgage is the process of informing your mortgage lender that you intend to go forward with their loan offer. It is your first informal commitment to your lender and you can back out from it anytime without paying any fees.
Normally, it’s not suggested to apply to only one lender for a mortgage. So, people apply to more than one lender for a mortgage. These different lenders provide a borrower with loan estimates, fees, policies, etc. As a borrower, you have to carefully understand and compare the different loan estimates and fees.
After comparing the loan estimates and fees, you choose one lender according to your preferences. Then you have to commit to the lender so that the lender can proceed further. This proceeds further or go-ahead signal is known as intent to proceed mortgage.
Most intent to proceed mortgage is in written format. However, there can be verbal intent to proceed mortgage depending on the lender.
Find Out What is Morgage Underwriting
Here is a simple flowchart for the intent to proceed mortgage process
Intent to proceed mortgage applies to all kinds of mortgages including a reverse mortgage.
Now let’s have a look at an Intent to proceed mortgage form.
Intent To Proceed Letter
If you are having trouble writing an Intent to proceed letter then you can save this Intent to proceed mortgage pdf and use it.
Also, Check Can You Borrow Extra On Your Mortgage For Furniture?
So, how long do you have for the intent to proceed mortgage,
Intent to Proceed Mortgage Regulation
According to the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA) mortgage disclosure rules
Lenders must provide borrowers with a Loan Estimate document within 3 days of receiving their mortgage application.
Once the borrower receives the Loan Estimate, the borrower has to indicate their intention to proceed with the loan application within a time frame. This is known as the “Intent to Proceed” regulation.
The purpose of this regulation is to ensure that borrowers get sufficient time to review and understand the terms of the loan before committing to it. Moreover, It also prevents lenders from charging fees for services they haven’t yet agreed to receive.
But what is the intent to proceed TRID 10 days?
How Long Do You Have To Submit The Intent To Proceed Mortgage?
You should submit the intent to proceed letter within 10 days after you get the loan estimate. Actually, you can submit the intent to proceed letter anytime you want. However, it’s better to submit it within 10 days.
Because according to GFE law,
A lender can not change the fee, estimate, or loan terms within 10 days of providing the loan estimates.
This law is also known as the intent to proceed TRID 10 days.
So, if you submit the intent to proceed mortgage letter within 10 days then the lender can not change any terms or charge any extra fees. As a result, it’s better for you to submit it within 10 days.
On the other hand, if you don’t submit it within 10 days then the lender has the ability to revise the estimated costs, fees, and terms and provide you with a revised loan estimate.
But what if you don’t submit an intent to proceed letter?
What If You Don’t Submit An Intent To Proceed Letter?
If you don’t submit an intent to proceed letter within 30 days of getting the loan estimate, the loan officer will close your application letter.
As you will be applying to more than one lender for a mortgage and you will choose only one. So, you can’t submit an intent to proceed letter to every lender. So, how do you close the other applications?
You don’t need to do anything. Just remain silent and the other loan applications will be automatically closed within 30 days.
Is Intent to Proceed Binding?
No, the intent to proceed mortgage is not a law-binding document. Meaning you can cancel it anytime you want. It is just an informal letter from you to the lender. So, there is nothing to worry about.
However, do you need to provide any fee for the intent to proceed mortgage?
Is There Any Fee For The Intent To Proceed Mortgage?
No, you don’t have to provide any fee for submitting the intent to proceed mortgage. In fact, it is illegal for lenders to charge any fees before you submit your intent to proceed mortgage.
However, after you submit your intent to proceed mortgage letter then you need to provide an application or appraisal fee for the mortgage along with all the necessary documents. The appraisal fees you provide should be listed on your loan estimates and these fees are mostly non-refundable third-party fees.
After you provide the intent to proceed letter and appraisal fees, your loan officer will start looking at your documents and decide whether they will lend or not.
By this time, a question might come into your mind, Can I back out of a mortgage after signing intent to proceed?
Backing Out After Signing Intent To Proceed- Is It Possible?
Yes, it’s completely possible to back out from a mortgage lender after you provide an intent to proceed letter. Moreover, you don’t have to face any consequences if you back out from an intent to proceed mortgage.
However, you may face delays when you shift from one lender. Because if you shift then you need to redo the whole process from the start with your new lender. As a result, there is a possibility that your chosen house might be sold to other buyers.
So, when are you committed to a mortgage lender?
When Are You Committed To A Mortgage Lender?
Actually, you are not committed to any mortgage lender until you sign the closing papers. After you sign the closing papers your loan will be locked and the funding process will begin.
However, even after you sign the closing paper both your lender and you can cancel it. But canceling a locked loan is a complicated process and you will be at risk if you have already under contract to buy your chosen house.
Do all Borrowers Have to Give Intent to Proceed?
Yes, all the borrowers have to give the intent to proceed. Because without your permission a borrower can not go forward with the loan process. Providing an intent to proceed mortgage indicates that you agree or slightly agree with the loan estimation and want to go forward for more discussion.
So, proving an intent to proceed is a must.
In Summary
Intent to proceed mortgage is the first step towards taking a mortgage and it is not a law-binding document. So, you can back out from it.
Finally, taking a mortgage is a big responsibility and the process of taking it can be complex. So, please consult with a mortgage expert or financial advisor if you want to make this process seamless and protect your interest.
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