6 minute read
April 8, 2022

How Long Does It Take to Buy a House?

How Long Does It Take to Buy a House?
6 minute read
·
April 8, 2022

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If you’re considering a new home, you’re probably asking yourself, “how long does it take to buy a house?” 

The home buying process can be different for everyone. It takes the average American about two months to find their dream home and another two months to close. 

Let’s look at the steps involved in buying and how long each takes.

Get pre-approved and start searching (a few days)

Mortgage pre-approval tells sellers you’re serious. 

Pre-approval helps you understand how much you can afford to spend on a house, and it usually only takes a few hours to complete. 

Letters for pre-approval generally expire 90 days from their issue date. But lenders can typically refresh them if you haven’t found the right house yet. 

It’s important to remember that mortgage pre-approval doesn’t guarantee interest rates or that your mortgage application will automatically be approved. 

Once you are pre-approved, avoid doing anything that can negatively impact your FICO credit score or mortgage eligibility. This includes applying for new lines of credit.

Mortgage pre-approval is available for FHA loans, VA loans, USDA loans, and other loan programs.

Like the home loan specialists at Assist Home Loans, lenders can help you decide which product is best for you. They can also go through down payment options and help you get pre-approved for a mortgage. 

Pre-approval can vary, but lenders typically require bank statements, tax returns, pay stubs or proof of employment income. 

Step 1 of 7

In what ZIP code are you thinking of buying?

Start planning to buy a house (a few weeks to several months)

Before you buy, it’s worth thinking about what you want in your dream home. 

For example, do you need a fenced yard? Can you do repairs? What about finances?

A monthly budget that calculates how much you have to spend on mortgage payments can also help you reach closing cost or down payment saving goals.

And based on your budget, your mortgage broker can go over down payment assistance options and other products that could help.

Choose a mortgage lender (a week)

Some conventional loans offer 3% down payments and favorable terms. 

Lower down payments and longer loan terms can help buyers purchase a home, but conventional loans often require higher credit scores. 

Buyers who don’t qualify for conventional loans can still apply for government-backed loan programs. These loans include VA home loans (for eligible military service members), FHA or USDA. 

FHA home loans offer a low down payment, while USDA and VA loans offer zero down payment options. Additionally, FHA and VA loans are available for current homeowners considering a mortgage refinance.

Get to know your market (a few weeks)

Searching online listings and visiting open houses can help you get a feel for the local housing market. Seeing available homes can help you narrow choices and better define what you want in your dream home.

It can also help you connect with local area real estate agents who can guide you through the home buying process and help you connect with home appraisers, inspectors, or attorneys.

Close your loan (about a week)

Once your mortgage lender finishes underwriting your home loan and the home inspection and appraisal are completed, it’s time to close your loan. 

You’ll receive the “Closing Disclosure” document from your lender outlining your mortgage’s final terms, confirming your interest rate, and detailing any closing costs you might have to pay. 

You’ll have three days to read the “Closing Disclosure,” after which you’ll meet with your lender for a closing meeting. This is when you’ll sign loan papers and pay any down payment or closing costs. When the meeting finishes, you’ll officially own your home.

Qualify for your loan (a day or two)

The first step toward mortgage approval is mortgage pre-approval. But, unless you’re making a cash purchase, you’ll need mortgage approval to finance your purchase. 

A pre-approval is not a commitment and the loan amount needs to be finalized. 

And the good news is because you’ve already been pre-approved, mortgage approval generally only takes a day or two. 

Once your lender verifies your income, reviews your credit history, amount of current debt—and provided nothing has changed to negatively impact your eligibility—they’ll issue your official mortgage estimate detailing how much they are prepared to loan you. 

Prepare for closing (about one month)

Once the seller signs your offer to purchase, you’re ready to wrap up the mortgage application process. 

Most lenders take anywhere from a month to six weeks to finalize your loan and ensure your new home meets any necessary requirements. 

During this time, you’ll arrange for a home inspection and your lender will schedule a home appraisal and arrange for your home loan to be underwritten.

Appraisal

An appraisal is an evaluation of your home’s actual value, done by an independent third-party. Inspectors are skilled at assessing the fair market value of residential homes. 

Lenders require home appraisals—and some loan products, like FHA home loans, do as well—to ensure your loan isn’t for more money than your home is worth. 

Depending on your home and type of mortgage, your appraisal can range from a full inspection to a remote “desktop” appraisal—which can be completed without a physical inspection. 

Some loan programs, like FHA loans, require borrowers to address any safety hazards found during the appraisal before the closing date.

Underwriting

As part of the home loan underwriting process, lenders verify a borrower’s income, debt, and any assets by reviewing bank statements and your credit report. They do this to ensure you can afford the mortgage payments for the lifetime of your loan. 

While your lender completes the mortgage application, only the underwriter can approve or deny a loan application. Once approved, the underwriter will issue your final mortgage agreement. 

Current homeowners looking to refinance go through a similar underwriting process.

The bottom line — Reach out to Assist Home Loans for honest and trustworthy loan officers

From your first thoughts to moving day, deciding to buy a home can take a year—or sometimes more. 

To make buying a home as simple and straightforward as possible, it’s important to get pre-approved before you house hunt. 

Mortgage pre-approval tells both sellers and real estate agents that you’re financially capable, willing, and ready to buy a home—and it can save time too.

And Assist Home Loans can help with that. 

Whether you’re buying your first home or are interested in refinancing your current mortgage, the experienced team at Assist Home Loans is ready to help you navigate the mortgage process. 

Contact us today or get current rates online. 

In addition to conventional mortgages, we proudly work with most home loan products, including USDA loans, FHA loans, and VA loans to help you get the best rates and most favorable terms available.

Photo by Tierra Mallorca on Unsplash

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