How Long Does it Take to Close on a House?
Closing on a house is defined as the day when the sale of a home is finalized.
This process usually takes place 40-60 days after the offer is accepted, but can be shorter or longer depending on the situation.
For buyers paying cash, closing usually happens much faster than for those taking out a mortgage. This is because there are no loan underwriting timelines to work around and often fewer steps in the process overall. For buyers using a mortgage, the closing can take anywhere from a few weeks to a few months. This is because the mortgage process involves many more steps, including income verification, employment verification, appraisal, and loan underwriting.
The Closing Day
The actual closing day itself usually only takes a few hours. During this time, both the buyer and seller sign all of the necessary paperwork to finalize the sale. Once this is complete, the buyer officially becomes the new owner of the home.
If you’re wondering how long it will take to close on your own home, the answer will depend on many factors. However, by working with an experienced real estate agent and mortgage lender, you can ensure that the process goes as smoothly and quickly as possible.
If you’re paying for your home in cash, the process is much simpler and can often be done in as little as 30 days.
The main thing you’ll need to do is get a property appraisal to make sure you’re not overpaying, and then you can move forward with the purchase.
To speed the process, most cash buyers opt to waive contingencies such as appraisal and home inspection. By doing so, they’re indicating to the seller that they’re serious about buying the home and are willing to move forward without delay.
Buying with a Mortgage:
If you’re taking out a loan to finance your home purchase, there are a few additional steps that will need to be completed.
The first is to get pre-approved for a mortgage. This step is important because it will give you an idea of how much money you’ll be able to borrow from the lender. It’s also a good idea to get pre-approved before finding a home, as it will give you a better bargaining position when making an offer.
Once you’ve found a home and made an offer, the next step is to get a loan estimate from the lender. This document will outline all of the fees and closing costs associated with your loan. At this point, you’ll also need to pay for a home appraisal and submit any necessary paperwork to the lender.
The final step is to close on the loan and sign all of the necessary paperwork. This usually takes place at a title company or escrow office. Once everything is signed and the money has been exchanged, you’ll be ready to move into your new home.
While the process of closing on a house can vary depending on the situation, it typically takes an average of 50 days to complete. So, if you’re planning on buying a home, be sure to factor in this timeline when making your plans.
What Causes Delays When You Close on a House?
There are a number of factors that can cause delays when closing on a house. Here are some of the most common:
– Appraisal issues:
If the appraised value of the home comes in lower than the purchase price, the lender may not be willing to provide financing. This can cause delays or even lead to the deal falling through entirely.
– Home inspection issues:
If the home inspector finds any problems with the property, the buyer may ask for repairs to be made or a price reduction. The seller may not be willing to make these changes, which can cause delays in the closing process.
– Loan processing:
The loan approval process can take longer than expected, which can cause delays in closing.
– Title issues:
If there are any problems with the title of the property, it will need to be resolved before the sale can be finalized. This can often be a lengthy process.
Bad weather can delay home repairs, inspections, and appraisals. This can lead to delays in the closing process.
If you’re planning on buying a home, it’s important to be aware of these potential delays. By understanding the closing process and what can cause delays, you can be better prepared for any bumps in the road.
How to Avoid Delays When Closing on a House
There are a few things you can do to avoid delays when closing on a house:
– Get pre-approved for a mortgage:
This will help you avoid any delays caused by the loan approval process.
– Get a loan estimate:
This document will outline all of the fees and closing costs associated with your loan. By getting this in advance, you can be prepared for any unexpected costs.
– Pay for a home appraisal:
This will help you avoid any delays caused by appraisal issues.
– Submit all necessary paperwork to the lender:
This will help you avoid any delays caused by loan processing.
– Have a realistic timeline:
Be aware of the potential for delays and factor this into your timeline. This will help you avoid any unnecessary stress.
By following these tips, you can help ensure a smooth and hassle-free closing process.
What Are Closing Costs?
Closing costs are the fees and expenses associated with buying a home. These costs can vary depending on the type of loan you get, the state you live in, and the price of the home.
Some common closing costs include:
– Mortgage points:
These are fees paid to the lender at closing in order to get a lower interest rate.
– Appraisal fee:
This is the fee charged for having the home appraised.
– Home inspection fee:
This is the fee charged for having the home inspected.
– Loan origination fee:
The lender charges a fee for processing the loan.
– Title insurance:
This insurance covers the lender against any issues that relate to the property’s title.
– Escrow fee:
This is the fee charged for setting up an escrow account.
The fees associated with closing a loan can differ widely, so borrowers should take the time to compare their options. Be sure to ask about closing costs when shopping around for a mortgage.
The Process to Close on a House – Step by Step
1. The first step in the closing process is to get a loan estimate from the lender. This document will outline all of the fees and closing costs associated with your loan.
2. The next step is to pay for a home appraisal. This will help you avoid any delays caused by appraisal issues.
3. The next step is to submit all necessary paperwork to the lender. This will help you avoid any delays caused by loan processing.
4. The next step is to have a realistic timeline. Be aware of the potential for delays and factor this into your timeline. This will help you avoid any unnecessary stress.
5. The final step is to close on the house. This process can take several weeks, so it’s important to be prepared for any delays.
By following these steps, you can help ensure a smooth and hassle-free process of closing on a house purchase.