So, you want to buy a house? Fantastic! You may be going to start a new career in a different city, or you may be ready to become a first-time homeowner.
Whatever the reason you’re looking to buy a home, you’re undoubtedly wondering how long it will take. Don’t worry about it! We’ll show you how long it often takes to buy a house so you can confidently approach your relocation.
Purchasing a home often takes four to five months. Including the two to three months it takes to discover the perfect home. And another one to two months between contract and closure.
Keep in mind that this is only a rough average. Numerous variables can cause the process to move faster or slower. Now, to get even more specific, let’s break down each home-buying stage.
But first, you should understand how critical it is to save a substantial down payment before beginning the home-buying process. If your down payment is too little, your monthly payments will be too high—a prescription for becoming house poor.
First-time home purchasers should save enough money to make a 5-10% down payment. The ideal choice, though, is to save up for a 20% down payment, as doing so prevents you from having to pay for private mortgage insurance (PMI). It may take a few years, but it will be worthwhile in the end. It’s a big deal.
1. Locating a Real Estate Agent Duration: a few days
A staggering 89% of house buyers engage with a real estate agent to purchase their property—which is exactly how it should be.
For a variety of reasons, having a great realtor on your side is essential when purchasing a home. They will guide you through the entire buying process, assist you in finding a home within your price range, and handle much of the paperwork. A excellent agent is worth every money, and they are easy to find.
You may discover an agent in your neighborhood by conducting a quick Google search, but don’t do so—a it’s surefire way to end up with someone who doesn’t know what they’re doing. Instead, use our RamseyTrusted program to connect with a local agent, which matches you with many top-tier, experienced agents in your area.
2. Looking for a Home: 2-3 months
That’s right looking for a home takes a significant amount of time! There is a great deal that goes into it.
To begin, develop a list of your must-haves. Most likely, a property must have a particular amount of bedrooms, baths, stories, or yard space before you’ll ever consider purchasing it. You may also choose to reside near schools, community facilities, or shopping complexes that suit your needs.
After your agent has determined your must-haves, they will begin looking for houses for you to view. It means you’ll be juggling your schedule in order to attend those viewings and open houses.
The property market can affect how long it will take to find a home. When you have a lot of buying competition in a market with fewer homes for sale, the greatest homes at the lowest prices sell quickly.
That being stated, you may need to be particularly patient in order to discover a home that meets your budget and lifestyle. Don’t give up and stay inside your budget!
3. Presenting an Offer and Negotiating a Contract
Once you’ve located the perfect home for you, submit a formal offer through your real estate agent as soon as possible. This is the contract between you and the seller, which they will accept, reject, or contest.
If they make a counteroffer, you may find yourself going back and forth to get the best deal—this might take more than a day.
4. Arranging a Home Inspection: Only a few days to plan, but only a few hours to inspect
If everything goes as planned and the seller accepts your offer, you should arrange for a house inspection. Depending on the results of the inspection, the seller may need to make repairs before you can finalize the purchase, which is why you should schedule the inspection as soon as possible.
5. Mortgage Closing Time: 1-2 Months
Your lender will begin finalizing your mortgage when you and the seller reach an agreement on a deal. This procedure includes a home appraisal, which is akin to a home inspection.
Again, the appraisal will most likely only last a few hours, but scheduling one may take several days. If the appraiser concludes that the home’s value is significantly lower than the selling price, you may be forced to restart the mortgage process.
As the appraiser is working, your lender will go over all of your financial records as well as any state or municipal rules to write out the loan terms.
During this stage, your title attorneys will also search and verify the home’s title. They will ensure that there are no obstacles to putting your name to the title and deed.
6. Obtaining Home Insurance: a few days
The next step is to obtain home insurance for your new residence. This payment is typically included in your monthly mortgage payment.
This stage may take longer if your insurance company sends a person to inspect your home in order to determine your coverage and policy.
7. Closing on Your Home (Yay!)
Time required: a few hours.
Closing day is the last step! The only time commitment required here is a meeting with the professionals that have been assisting you with transferring the residence into your name. When you sign a bunch of paperwork, the keys are yours!
How Can You Accelerate the Home-Buying Process?
Purchasing a house will take time no matter how you slice it, but there are some actions you can take to expedite the process.
To speed up the home-buying process follow these Suggestions:
Purchase Your House with Cash
Want to speed up the home-buying process? It must be paid in whole in cash. That’s right, there’s no mortgage.
Consider this: If you don’t need a mortgage, you won’t have to deal with the time-consuming procedures of obtaining one. There is no need for an approval process, loan application, or anything else.
We understand that paying cash for a home isn’t for everyone, but it’s more common than you might think. Nowadays, around 30% of homes are purchased with cash—no mortgage. 4 Those people most likely did not spend nearly as much time looking for a property as the typical Joe!
Get a Mortgage Preapproval
If you do decide to get a mortgage, get preapproved first. It demonstrates to the seller that you’ve visited a mortgage lender and determined that you can afford the home you’re looking at.
Preapproval takes a few days from the time you contact a mortgage firm to the time you receive the letter. But, the extra time frequently pays off later by speeding up the contract-to-closing process. This is where our friends at Churchill Mortgage can help.
By the way, the only mortgage you should consider is a 15-year, fixed-rate conventional mortgage—going with a 15-year rather than a 30-year can save you thousands of dollars in interest. You should also avoid FHA and VA loans due to the high fees involved.
You should also ensure that your monthly mortgage payment, including the cost of homeowners insurance and HOA fees, does not exceed 25% of your take-home earnings (even though a lender may approve you for more than that). That way, you’ll have enough money in your budget to spend toward other key financial goals, such as retirement savings.
Collect Vital Documents
You should already have all of your pay stubs, bank statements, and tax records on hand if you’ve been preapproved by a mortgage firm.
But keep them near at hand and as current as possible. They’ll come in handy again during the mortgage application process.
Prepare Your Closing Money
Don’t forget to pay for closing expenses when saving for a house! You should keep these cash in a location where you can conveniently access them. That way, when the time comes, you’ll be ready to transfer the funds.
What Should You Do If Your Plans Are Postponed?
Have a backup plan available in case closing day is delayed for any reason. If you have a set move-out date from your current residence, you may require a place to stay. That’s why it’s usually a good idea to give yourself a few extra days (beyond your closing date) to account for delays.
Locate an Experienced Agent to Assist You in Your Home-Buying Process
Working with a quality real estate agent, as we discussed earlier, is one of the greatest methods to keep on track with your timeline while buying a house.
Questions and Answers:
What is the most time-consuming aspect of the home-buying process?
The most time-consuming aspect of the house-buying process is looking for and finding the appropriate home. On average, this takes two to three months.
How can you expedite the home-buying process?
There are various methods for expediting the home-buying process. Being preapproved for a mortgage, getting a grasp on paperwork early in the process, and having your closing costs ready to go in cash are some of the finest.
How much should you put aside for a down payment on a house?
First-time home purchasers should save enough money to make a 5-10% down payment. If you can wait a little longer and put up a 20% down payment, you will avoid having to pay private mortgage insurance (PMI). Remember that a larger down payment means lower monthly mortgage payments.