Home Buying Timeline
When buying a home, there are several essential things to know. One of the most vital is understanding various time frames to complete common contingencies.
There are several stages of the home buying timeline a buyer needs to go through to reach the final stage of closing.
One of the more common questions real estate agents will receive from buyers and sellers is how long it takes to close a house. By understanding the process of purchasing a home, you’ll better understand the answer.
It generally takes 30-60 days to close on a house. This window is the average time to close a house. Let’s have an in-depth look at the stages.
Finding a Home and Submitting an Offer
When a buyer finds a home they are interested in, they will make an offer to the seller. The offer will include the purchase price, financing contingencies, and other details such as inspections and closing costs.
Once the seller receives the offer, they will have a specific amount of time to accept, reject or counter it. Generally, most sellers will respond on the same or the next day. If the seller accepts the offer, then the process of closing will begin.
Quite often, some counteroffers go back and forth. Many offers take a couple of days to complete acceptance with the execution of the contract.
The Home Inspection Process
Most real estate contracts give buyers 7-14 days to complete an inspection. Once the inspection takes place, the buyer typically has a couple of days to respond with any requests to the seller.
During the home inspection process, buyers can request various repairs or seller concessions they want the seller to address. The seller then has a certain amount of time to respond to the buyer’s requests. It is essential to understand the timeline of the inspection process to ensure that everything is completed promptly.
The goal is to have a meeting of the minds so the transaction can proceed to the next step.
It is essential to note that sometimes there are specialty inspections, such as checking for radon, mold, and water quantity/quantity. These additional tests can take a few days to complete and are part of the buyer’s due diligence period.
Applying For a Mortgage
Once the home inspection is completed, buyers will typically get their mortgage application completed with the lender they are using. Filling out the required paperwork and gathering the required lender documents can take a few days to complete.
To prepare yourself, it is a good idea to begin putting together copies of your pay stubs, tax returns, and W2s in electronic format. The lender can get you pre-approved even before you find a home.
We recommend speaking with a lender well before you find a real estate agent just to be sure you are ready to buy a home. To have a conversation with someone to talk about how much you can afford, complete this short form.
The Purchase and Sales Agreement
In some areas of the country, there are two contract states: an offer to purchase and a purchase and sales. In states with a purchase and sale, it will typically be executed within 14 days of the offer acceptance.
During this time frame, a buyer’s and seller’s attorney will negotiate the final draft before being executed by both parties.
The Real Estate Appraisal
In most real estate transactions, there will be a property appraisal. When the buyer puts down a significant amount of money, an appraisal will be waived in some limited circumstances.
When there is an appraisal, it will be conducted by a licensed appraiser hired by the buyer’s mortgage lender. The real estate appraisal usually takes place within a few weeks of the property going under contract and usually after you receive a conditional approval from the lender.
The appraisal visit to the home is typically completed in under an hour. The appraiser leaves the house and starts the process of completing their work. Most of the time, an appraisal is back to the lender in about a week’s time.
The Mortgage Contingency Process
The mortgage contingency process is a crucial part of the real estate transaction and generally takes 4-6 weeks. This process is in place to protect the buyer, ensuring they have the necessary financing to buy the home. The buyer will work with their mortgage lender to obtain financing during this process.
The mortgage contingency process includes the lender ordering the appraisal, reviewing the buyer’s credit and income, and verifying the buyer’s assets.
The lender will also order a title report and coordinate the closing disclosure process. During this time, the buyer and lender will finalize the loan terms, including locking the interest rate.
Once the mortgage contingency process is complete, the buyer will be positioned to close on the home.
Some mortgage programs can take slightly longer to close. A few examples are FHA and VA loans. These loan programs need approval from their respective agencies and lender.
The Closing Itself
A buyer generally takes 1-1.5 hours to sign all the lender’s mortgage documents and this can be done remotely with the use of a mobile agent if needed.
The buyer will sign the loan documents as well as the title documents. The title documents will hand over property ownership from the seller to the buyer.
Once the buyer has signed all of the documents, the closing agent will present the buyer with the keys to the home. The buyer will then be the proud owner of their new home.
Once all the documents are signed, the closing agent pays off any existing liens and disburses the funds to the seller.
The buyer will also receive the title to the property, which establishes their ownership.
At this point, the buyer can celebrate their accomplishment and make their new home theirs. It’s time to call the movers and let them do their work.
Home Buying Timeline Checklist
To keep things simple, this is a home buying timeline checklist of things that you should consider when preparing to purchase a home
- Monitor and repair any credit issues
- Get pre-qualified by a lender months before beginning your home search
- Identify a general area where you would prefer to purchase a home
- Find a professional real estate agent in the area of choice
- Provide the real estate agent with a pre-approval letter
- Begin your home search
- Negotiate a contract with the seller
- Complete the final details your mortgage application to include the property
- Order a home inspection
- Respond to underwriting requests
- Provide the lender with your homeowners insurance details
- Close on your new home
Timeline for Buying a House Out of State
If you are purchasing a home in another state, your timeline to purchase may be extended. There are other things that need to be considered and which can add time to your home buying timeline.
The first thing is figuring out the employment situation and how that will impact your mortgage approval. If you are applying for a mortgage with a new job, it is possible that your lender may require you to be in that job for at least 30 days. It will take a skilled loan officer to make this work with the underwriter and doing so could extend your timeline.
Next, when relocating and buying a new without a job , you will have to travel to tour homes in the area where you would like to live. Plus, if you do not have a job offer or if your current employer will not allow you to work remotely in the new location, you may need an alternative mortgage program which as a stated income loan.
FAQ – Home Buying Timeline
Why does it take 30 days to buy a house?
It takes at least 30 days to buy a house because of the various third parties that are also involved in the process. Appraisers, title companies, inspectors, and also the mortgage underwriting process combined will take a minimum of 3 weeks.
What is the timeline of getting a mortgage?
Getting the initial mortgage approval can take less than a week. However, it takes longer to take care of the various contingencies such as the appraisal and insurance coverage documentation.
What is the fastest you can close a mortgage?
The fastest you can close a mortgage is in about 10 days with a hard money loan. Hard money lenders do not require as much documentation and therefore can close quickly.