Buying a house is exciting, but it can feel like it takes forever to get from the offer to the closing table.
On average, it takes 30 – 45 days to get to the closing table, and that’s in a perfect situation. Sometimes you may close faster or slower, but keep 30 – 45 days in mind when signing a sales contract.
The Process to Close on a House
The house closing process is complex. Not only must you find the house you want to buy, but you must sort out your financing. Here’s a quick rundown of the typical timeline.
Start the process by getting pre-approved with a lender. This tells you how much you can afford, on what terms and the conditions you must satisfy.
A pre-approval letter also gets your foot in more doors with sellers. Most sellers only want to work with pre-approved buyers.
Find a Home
Once pre-approved, you can look at homes. Pre-approvals usually last 30 – 60 days, so it works best if you can find a home within that time.
You’ll sign a sales contract when you find a home and negotiate the price and terms. The sales contract starts the clock, which is why getting pre-approved is essential. After that, you’ll have a majority of your personal underwriting completed.
Submit your Contract and Order the Title and Appraisal
After signing a contract, you’ll submit your sales contract to the underwriter, and they’ll order a title search and appraisal on the property.
In the meantime, you’ll provide any missing documentation or updates the lender needs to finish underwriting your qualifying factors.
Get the Clear to Close
Your goal in underwriting is to get the clear to close. This happens after the appraisal, title search, and your qualifying factors pass the underwriter’s requirements. Then, with the clear to close, you’re ready to head to the closing table.
Receive your Closing Disclosure
Lenders must send you the Closing Disclosure before the closing. By law, they must send it at least three business days before you close. This allows you time to review your loan terms, costs, and interest rate to ensure everything looks how the lender initially promised.
If everything looks good, you get your cashier’s check or bank wire to close the loan and get ready to become a homeowner.
Closing the Loan
The last step is to close the loan. You’ll attend the closing with your attorney, loan officer, possibly the sellers, and a closing agent. You’ll sign documents and disclosures, exchange funds, and receive the keys to your new home.
Typically it takes 30 to 45 days to close on a house, but there can be delays. The key to avoiding them is to get pre-approved for your loan and satisfy any conditions the underwriter needs. Once you find a house, the only conditions you’ll have to focus on are those about the house, many of which are outside your control.