Steps to Buy a House: How Long Do They Take?

On February 6, 2017   /   Selling a Home  
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buying

By: Jamie Wiebe

Homes aren’t impulse purchases. It takes time to sift through listings and make your way from one home showing to the next; then, of course, there are those agonizing hours you wait to find out if your offer on a house was accepted, whether you can secure financing, and any number of other holdups.

Just so you’re prepared to play the waiting game, here are the steps to buy a house and how long they typically take, so you aren’t sitting there holding your breath and wondering if something’s up.

How long does it take to find a real estate agent?

Answer: A couple of days to a few weeks

Your real estate agent should be your most trusted consultant during the home-buying process. Don’t skimp on the search—even if you’re in a rush.

“The home-buying process is a complicated one, and the chosen agent must be the person who can best relay each step of the process in a way that will be understandable and reassuring to the homeowner,” says Diane Henderson, a Realtor® with McEnearney Associates in Alexandria, VA.

“Find the Realtor that ‘fits’ you,” she adds. “The whole process will go a lot more smoothly.”

Not sure where to find this special person? Head to realtor.com®‘s Find a REALTOR online tool to locate Realtors in your area.

How long does it take to get approved for a mortgage?

Answer: At least two weeks

Getting approved (or pre-approved) for a mortgage is no simple process. Lenders need to examine your documentation, review your financial information, and reconcile any problems. So even if all your documents are in order and you’re a stellar candidate, expect to wait two weeks or more to find out if you got the green light.

How long does a showing take?

Answer: 30 minutes to an hour

This one is largely up to you. A showing could be as quick as five minutes if you immediately decide you don’t like the property. But if you are interested, odds are you will take your time, poking your head into every closet and turning on every faucet.

That said, odds are you will know a home is The One surprisingly soon: One study found buyers spend an average of just 17 minutes inside a property before deciding to buy it.

Still, it’s essential to buy a home with your head as well as your heart, so go ahead and take your time to thoroughly vet every corner.

How long does it take for an offer to be accepted?

Answer: Less than three days

Unlike on “Property Brothers,” where offers are always accepted in a flash, the real world takes a bit more time. You may be tapping your toes in anticipation, but sellers have some leeway when responding to an offer. They have three options, each of which needs to be mulled over: Whether to accept your offer outright, counter it, or reject it.

Expect to hear back within three days (but hopefully sooner). Foreclosures are exceptions; banks might take up to 10 days to respond.

How long does a home inspection take?

Answer: Two to three hours for the inspection, then 48 hours for the results

Buyers should attend the home inspection, but be prepared for it to take a while. Inspections typically take about two to three hours—enough time for your inspector to examine the foundation, structure, fireplace, and other common problem spots. Don’t be afraid to ask questions, even if it means taking 30 more minutes.

“This is the best time to investigate your new home,” says Jeff Knox, the owner of Knox & Associates in Dallas. “After all, you have a licensed home inspector by your side. Nothing in the house is off-limits during your home inspection.”

Once the inspection is completed, expect to see a report in two days. When you have it in hand, you can work with the sellers to determine if any changes need to be made before closing.

How long does an appraisal take?

Answer: Up to two weeks

Like a home inspection, the appraiser—the professional who estimates the home’s value on behalf of your lender—might spend a few hours examining the property (and this time, your presence isn’t necessary). After viewing the house, the appraiser will examine comparable homes in the neighborhood (“comps”) and look through the neighborhood.

Because their prepared report can be quite comprehensive, sometimes reaching a hundred pages or more, its composition can take some time. Expect your lender to receive the report within two weeks.

How long does it take to close on a home?

Answer: 50 days

Home closing times are lengthening, currently averaging 50 days. Yes, it’s a pain. No one wants to wait more than a month to take possession of their new home, but don’t rush due diligence. Your lender will have a number of requirements, including providing paperwork like tax returns, before underwriting is complete. You can expedite this process (slightly) by having necessary documents prepared in advance.

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The Closing Process: What Home Buyers Can Expect on the Big Day

On October 10, 2016   /   Closing  
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closing what to expect

By: Margaret Heindenry

The hardest parts are over: You’ve found that perfect home in a haystack of listings, negotiated a deal you’re happy with, and secured a mortgage—and you’re now in the home stretch of the home-buying process. Just one more critical hurdle lies ahead: the home closing. Also known as “settlement” or “escrow,” this is a day when all involved parties meet to make this transaction official.

To make sure you’re fully prepared, here’s what to expect from the closing process, step by step.

Step No. 1: How to prepare for a closing

Review your closing disclosure form: If you’re getting a loan, one of the best ways to prepare is to thoroughly review your HUD-1 settlement statement.

“This helps ensure the buyer understands the terms of their loan,” says Ben Niernberg, executive vice president of business development and operations at Proper Title.

The HUD-1 settlement statement outlines your exact mortgage payments, a loan’s terms (such as the interest rate and term) and additional fees you’ll pay, called closing costs (which total anywhere from 2% to 7% of your home’s price). Compare your HUD-1 to the good-faith estimate your lender gave you at the outset; make sure they’re similar and ask your lender to explain any discrepancies.

Thanks to new regulations put in effect in October 2015 known as TRID (which stands for TILA-RESPA Integrated Disclosure), you will receive your HUD-1 three days before closing so that you have plenty of time to check it over. (Before TRID, home buyers received this form only 24 hours ahead of time, which resulted in a lot more last-minute surprises and holdups.)

Do a final walk-through: A buyer’s contract usually allows for a walk-through of the home 24 hours before closing. First and foremost, you’re making sure the previous owner has vacated (unless you’ve allowed a rent-back arrangement where they can stick around for a period of time before moving). Second, make sure the home is in the condition agreed upon in the contract. If you’d had a home inspection done earlier and it had revealed problems that the sellers had agreed to fix, make sure those repairs were made.

If you find an issue during your walk-through, bring it up with the sellers as soon as possible. There’s no need to panic; at worst you can simply delay the closing until you resolve it.

Step No. 2: What to bring to closing

All your paperwork: You’ll want to bring proof of homeowners insurance, a copy of your contract with the seller, your home inspection reports, anything the bank required to approve your loan, and a government-issue photo ID. (Note to newlyweds who just changed their name: That ID needs to match the name that will appear on the property’s title and mortgage.)

Your down payment: You will already know from your disclosure form exactly how much  you’ll have to cough up for a down payment and closing costs. Yet since a personal check won’t cut it, be sure to ask before closing whether you should wire transfer those funds or if you’ll need to bring a cashier’s check. Also bring your personal checkbook to closing, since that’s typically fine to pay smaller fees and may come in handy in case any unforeseen expenses crop up.

Step No. 3: What to expect at closing

A bunch of people: Exactly who will be present at a closing (and where it’s held) depends on the state you live in, but there are certain supporting characters you can usually expect to make an appearance. The cast includes the home seller, the seller’s real estate agent as well as your own, buyer and seller attorneys, a representative from a title company (more on that below), and, occasionally, a representative from the bank or lender where you got your loan.

Title clearance: Before you can own or “take title” to a home, most lenders will require a title search of public property records to make sure there aren’t any liens or issues with transferring the property into your name (which is rare, but if something does crop up, it’s better to know that upfront).

Signing your name a lot: You’ll be putting your John Hancock on a pile of legal documents (so be prepared for a mild hand cramp if you’re not used to writing in cursive).

A few curveballs: Be prepared for things to go awry at the closing, like someone gets stuck in traffic, a document is missing, or a name is misspelled. But don’t stress, simply do what’s in your power to make the day go off without a hitch. For instance, don’t schedule something two hours after the closing is supposed to start in case your closing runs over.

If all goes well (as it usually does), you will eventually leave your home closing with a stack of documents (which you should save) and the keys to your new home (finally!).

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My Offer Was Accepted—Now What?

On March 15, 2015   /   Home Buying  
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offer accepted

By: Craig Donofrio

Having your offer accepted feels great—but for most home buyers, it’s just the beginning. There is still a lot more to be done before you’re over the front threshold. Here’s a rundown of what comes next.

1. Apply for a loan

Unless you’re paying in cash, you’ll need to apply for a mortgage loan (if you’re already pre-approved, good for you). If you’re not pre-approved, meet with at least two or three lenders and compare their loan options. Be prepared to ask questions, and be completely open with the lenders about your finances.

2. Home appraisal and inspection

The next step is getting your home appraised and inspected.

Your lender will require your house be appraised by a professional, who is usually provided by the lender. The appraisal gives you a detailed report on the value of the home. If the home’s appraised value is less than the purchase price, you will need to either make a greater down payment or negotiate with the seller to lower the price. A lender won’t give you a loan for more than the appraised value.

A home inspection tells you if the home has any issues. Inspections aren’t always required, but you should absolutely get one even if you’re not getting a loan. Go over the inspection report in detail with the inspector to make sure you’re familiar with any problems, their severity, and the estimated cost to fix them. Additionally, you may also want to get your home checked for radon and pests, which are additional costs.

If the inspector finds problems, you may be able to get the seller to pay for necessary repairs or lower the price to adjust for the cost.

3. Get your funds ready

Make sure the funds you need for closing and in reserves are both accessible. If you need to pull money from an investment, do it right away. Keep the paperwork for the transaction to show your lender you liquidated funds to get your down payment.

4. Find homeowners insurance

In most cases, buyers are expected to pay for homeowners insurance upfront, before closing. Depending on where you live, you might need extra insurance, like flood coverage. Shop around at several different insurance companies for the best rate. Your lender will need proof of insurance before approving your mortgage. 

5. Final walk-through

You will be allowed to do a final walk-through of your new home 48 hours before closing.

This allows you to make sure any items that should be there, as per your contract, remain. It also lets you check the condition of the home to make sure no extra damages have occurred. If you find anything different from what you agreed upon, you may postpone the closing to give the seller time to fix the problem.

It’s important that you catch every issue during the final walk-through. If you spot them after closing, they’re going to be your problem.

6. Closing

This is the day when you sign the mortgage documents and officially gain ownership of the property. Most likely your Realtor® will be there, as well as the seller, the seller’s Realtor, the closing officer, and perhaps the mortgage broker.

You will need to bring ID and a cashier’s check to pay closing costs, which you will know in advance (and if they look different, don’t be afraid to walk away). Your spouse will also need photo ID. (In some states, spouses are required to attend and sign papers even if they aren’t on the mortgage.) Check with your Realtor about the details of your closing.

Updated from an earlier version by Laura Sherman

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