How long does it take to buy a home?
When it comes to buying a home, there are no short cuts. According to experts, it’s a fairly lengthy process that takes most buyers around four months or more.
However, that’s not a fixed number, and the time it will take to buy a home will vary based on a number of factors – such as the competitiveness of your market, preparation for the mortgage process, and the type of loan you are getting.
Fortunately, there are things you can do to speed up the process and improve your chances of getting your dream home. If you know what to expect, you are ahead of the game.
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Timeline for buying a home
There are five main steps you need to take to buy a home – some are pretty quick and painless, others are more time-consuming and challenging.
Let’s take a closer look at each one:
- Get pre-approved for your mortgage. A … have Pre-approval for mortgages in hand is important before you start buying a home. The pre-approval letter shows that you are eligible for a home loan and can actually afford the home you want – most sellers won’t accept a listing without one. Fortunately, this is relatively easy and can be done in only minutes online, depending on your mortgage lender
- Find a house (and get your offer accepted). This will be the longest part of the process, especially in today’s highly competitive marketplace. You can expect to spend a couple of weeks – often a couple of months – looking for the perfect house (and bidding on it)
- Secure your mortgage loan. Applying for your loan, submitting your paperwork, and waiting for your lender to sign up will usually take around six to eight weeks total. From February 2021the average mortgage loan took about 53 days from start to finish. VA and FHA loans last a few days longer than traditional loans due to the increased paperwork
- Have the house assessed and inspected. Your lender should arrange the evaluation that is done within a few weeks submitting your application. The appraiser will verify that the value of your home is sufficient to secure the approved loan amount. The home inspection usually takes place within the first 10 days
- Close your loan. This is the final step in the process and it usually takes time a few hours. On the last day you sign your documents, hand over your deposit and closing costs and receive the keys for your new home
If everything goes smoothly and you can find a home quickly (and win the bidding war), you will be able to buy your home within two months.
However, it usually takes a little longer, especially if you are in a highly competitive real estate market.
What can cause delays in home buying?
There are a lot of hiccups that can delay your home purchase – sometimes quite a bit. Bid wars are one of the most common in today’s landscape.
If you find yourself in a market where housing supply is low and buyer demand is high, you may not win the first home you bid on – or even the second, third, or fourth.
According to Redfin, about two-thirds of buyers faced bidding wars in March 2021, making it difficult not only to find a home but also to get one at an affordable price. In many cases, these bidding wars can add weeks or even months to your home buying schedule.
Three things that can significantly slow down the home buying process are bidding wars, late paperwork, and negotiating with the seller.
If you are not prepared for your mortgage application, you can go back in time too.
Mortgage lenders need a lot of financial documents and also need updated records as you near your close date. If you are slow to respond to these inquiries or have trouble finding the right documentation, it can significantly delay your home purchase.
Finally, problems with your home inspection or valuation can also cause delays.
These ratings often require renegotiating with the seller, either for repairs or for price, and this is not always easy. This can sometimes add days or weeks to your timeline (especially if the seller needs to make repairs to the property).
How to speed up the home buying process
If you want your home purchase to go smoothly and promptly, there are a few strategies that can help you.
First, Be selective about your real estate agent or relator. Make sure you choose someone who is experienced, has time for you (i.e. doesn’t have 15 other clients at the same time), and who knows the market well.
A great agent gives you a competitive advantage when you not only find a home but win one when you do.
Especially if you are a first time home buyer, your agent will be of great help in making competitive (but reasonable) offers and counter offers.
You should also collect all of your financial documents early on as this can help make your mortgage process go faster.
The exact paperwork you will need will depend on your loan product and your mortgage lender. However, in general, you can expect that you will need:
- Your last two pay slips from work
- The last two years of tax returns and W-2 forms
- Two months bank statement (check and savings)
- Statements for retirement accounts or other assets you may have (401,000, IRA, stocks, bonds, etc.)
- Written declaration for large deposits or purchases on your bank statements
- Information on other sources of income such as social security, maintenance, child benefit, etc.
It is important to be prepared in other ways as well. Know your budget and discuss with your family (and representative) what to do if you get caught in a bidding war, your home valuation is low, or the home inspection shows that repairs are needed.
Having a plan for these challenges will help you react quickly and get your purchasing back on track.
The final result
There is no set number in stone for the average time it takes to buy a home. For some buyers, it could be just under two months. For others, it can take significantly longer.
To recap, at every stage of the home buying process, here’s what to expect:
- Mortgage Pre-Approval – Under a Day
- House Hunt and Offer – A Few Weeks or Months
- Complete the mortgage process – 30-60 days
- Home Inspection and Assessment – A few weeks
- Closing process – a few hours
If you are hoping for a quick and painless home purchase, your best bet is to find the right help, prepare for it, and be ready to get the job done.
In today’s hot market, you have to act fast if you want to win.
You can start by getting a loan approval so that when you find the right home you are ready to make a serious offer.