Buying a home can be an exciting yet often time-consuming process. It isn’t as simple as finding a home you like and handing over the cash. There are several essential steps you must go through so that your offer is approved and you take the proper steps to be sure you’re making a sound investment.
In total, the home buying process can take several months or more before you can sign the contracts and move in. Here is a closer look at each step and how long you should expect it to last.
The first step is to prepare yourself for your home buying journey by gathering the necessary financial documents and saving for a down payment. During this time, you should also decide on a neighborhood or general area and determine a rough budget.
This process may take a few weeks, or several years, depending on how soon you’re looking to move. But the more you prepare before you begin looking at homes, the smoother the journey will be.
Do your best to get all your ducks in a row and mentally prepare for the responsibilities of homeownership, so you’re ready to make a move when you see the perfect place.
Before you start looking at properties seriously, you should seek pre-approval from a lender. Unless you’re able to pay cash, you’ll need to show the seller that you have financing lined up for them to take you seriously.
While you can start looking at what’s out there before seeking pre-approval, you won’t be able to submit an offer until you know how much a lender is willing to give you.
The lender will ask you some basic questions about your finances and credit during the pre-approval process. Based on your responses, they will either reject you or provide you with a pre-approval letter letting you know how much money you can expect to get if everything checks out.
Once you’re officially preapproved, you can start looking for homes seriously. This step will likely be the longest part of the home buying process because you may look at dozens of properties before finding the right one.
To make your home search go a bit faster, you should consider enlisting the help of a real estate agent. They have access to exclusive listings and databases you may not be able to use on your own, which will allow you to see more properties. It’s up to you whether you want to move quickly or wait until you find your dream home but be prepared to search for at least a few months.
Once you’ve found the right property, consult with your agent or attorney and decide on a fair offer. Depending on how hot the market is, the seller may accept your offer right away, or you may go back and forth negotiating for several days or even weeks.
If you want to expedite the process, you should offer as much as possible to get the seller’s attention. But if you don’t mind a bit of negotiating, you can also put in a lower offer and see where the seller lands. Once you both agree on a price, you can sign a purchase agreement and start the due diligence period.
Once you agree to an offer, it’s time to do your due diligence and prepare for the closing. During this period, you’ll want to hire an inspector to verify the property’s condition and make sure there aren’t any red flags.
Your lender will also require you to hire an appraiser to ensure the home’s true value isn’t less than what you’re offering. If there are any potential issues discovered during this period, you can return to the negotiating table or even back out of the purchase if you can’t reach an agreement.
If everything checks out and you’re satisfied with the property’s condition, all that’s left to do is finalize your loan and close on the property. Your lender will then verify your financial credentials through an official underwriting process and provide you with a commitment letter (as long as everything checks out).
In the meantime, you will schedule the closing and conduct a final walkthrough to ensure that any last-minute issues have been handled. Then, the attorneys will prepare all the necessary paperwork, which you should review with your agent. You will bring the required funds to the closing table and sign the contracts, at which point you will become the new owner.
All in all, this process should take about a week unless there are any last-minute concerns.
Can I Buy a House in a Month?
Yes, it is possible to buy a house in a month, but it may not be easy. If you can pay cash or make a firm offer and the seller is ready to move, it’s possible to close within 30 days. But most home shoppers prefer to take a bit more time to do their due diligence and get the best deal possible.
What Time of Year is Best to Buy a House?
There is usually more inventory during peak buying season (April through July), but there may also be more competition and higher prices. You can often find great deals in December and January, but there will likely be fewer properties available, and it’s often more challenging to move in the winter. So, the early spring and late fall often offer the best of both worlds because they are on the fringes of the peak and dead seasons.
How Far in Advance Should I Get Preapproved for a Mortgage?
Mortgage pre-approval letters are typically only valid for a limited amount of time. Most pre-approval letters are good for 90 days, but some expire in as little as 30 days. So, you will want to seek pre-approval as close as possible to when you plan on looking for a home.
How Fast Can You Close on a House?
It typically takes anywhere from 30 – 45 days to close on a home sale. But it can happen even more quickly if you and the seller are both on the same page. For instance, if you purchase a distressed property, you may be able to close in as little as a week. But for the average homebuyer, you’ll want to make sure everything is conducted correctly and there are no issues with the title or property. Doing so usually takes a minimum of 30 days.