Diving into the home buying process? Whether you’re a first-time home buyer or a seasoned veteran, buying a home can be intimidating. Every purchase path is unique, but having a general idea of how long each step is going to take can help prepare you.
Before you get started, be sure to consider if you’re ready to buy a home. If you’re a first-time home buyer, this could mean comparing the costs of renting vs. buying, or making sure you have enough money saved for a down payment.
Home Buying Timeline
So how long does it take to get a home loan and buy a house? According to Zillow, it takes on average 4 ½ months to buy a home from start to finish. This isn’t a hard and fast number though. Each step on the home buying timeline has its own average length, and even one taking longer than planned can throw off the total time invested. Here’s what you can expect for the most common steps in the process:
FINDING A REAL ESTATE AGENT: A COUPLE OF DAYS–SEVERAL WEEKS
Do you absolutely need a real estate agent to buy a house? No. Will having one help you through the process, particularly as a first-time home buyer? Definitely! Plus, buyer’s agents are typically paid as a percentage of the sell price, so there may not be a direct cost to you. You can find a real estate agent fairly quickly, but unless you need to get in a house ASAP, don’t rush this one. Take the time to shop around, and if possible get referrals from friends or colleagues in the area where you’re looking to buy.
CHOOSING A MORTGAGE LENDER: 45 DAYS
If a real estate agent is your partner for finding a home, your mortgage lender is your partner in paying for it. Not only will a mortgage lender help you choose the right mortgage option and fill out the application, they’ll also be your point of contact in the years to come as you make mortgage payments. While choosing a mortgage lender can take any amount of time you’d like, there’s a reason to choose 45 days. Each lender you meet with will check your credit score to determine what mortgage rates you could qualify for, and normally pulling your credit score would negatively impact your credit score. When you’re rate shopping, however, FICO will consider all inquiries related to a mortgage made during a 45-day period as one single inquiry, so you’ll only receive a single “ding” on your credit score instead of multiple penalties for every lender you consider. It’s important to choose the right lender. After all, you could be entering into a 30-year relationship together!
GETTING PREQUALIFIED FOR A LOAN: A FEW MINUTES–3 DAYS
An initial assessment of the size of the mortgage you could qualify for, known as prequalification, can be relatively quick. You can often prequalify for a mortgage online in a few minutes. If you’d like to get a prequalification letter to produce to potential sellers, this may take a few days to have mailed to you.
HOME LOAN PRE-APPROVAL: A WEEK–SEVERAL MONTHS
Another “not required” step, but by taking the time upfront to be pre-approved, you can reduce the timing of several other steps. Because you’re filling out most of the paperwork upfront and going through some of the initial credit and financial history checks, the actual mortgage application process will likely take less time. Plus, because you have proof that you have conditionally secured funding, it could lower your time searching for a home and getting an offer accepted. Once you find a house you’re interested in, you can immediately make an offer – you don’t have to wait to secure funding. Sellers often look for buyers to have a home loan pre-approval letter, and may not accept your offer without it. So not only are you saving time down the road, you could also be ensuring that you have the best shot possible at the home of your dreams.
FINDING A HOME: 30–90 DAYS+
This is one where there is a lot more wiggle room. If you’ve been using home buying tools for a while now, whether online or in an app, you probably have a good idea of what you’re looking for. But if you’re new to even looking at homes, it could take some time to feel things out. You should definitely take all the time you need to find a house you’d like to put an offer on, and depending on how competitive the market is, you might have to make several offers before one is accepted. Remember that if you did secure a pre-approval letter, it will eventually expire – usually within 60–90 days – so if you’re still looking, be sure to get your pre-approval renewed.
Bonus Tip – How long does a showing take?
Plan to be at a showing for around 30 minutes to an hour.
GETTING A DECISION ON YOUR OFFER: LESS THAN 3 DAYS
Unless you’re buying a foreclosed home, you should receive a decision from the seller fairly quickly – after all, it’s likely they want to keep the process moving as well. So you should find out soon whether they accept, reject, or counter your offer. While you should get an answer quickly, if you’re trying to negotiate the house price, you could go through several rounds of offers.
FINAL LOAN APPROVAL AND CLOSING: AVERAGE OF 45 DAYS
After you have had an offer accepted and completed your mortgage application, you’ll need to wait for final approval and schedule a closing date. Ellie Mae released a report for November 2017 indicating that the house closing timeline is 45 days on average for a purchase loan. A couple of things will happen during this time, including:
Home inspection: 7–10 days
The actual inspection will take around 2–3 hours, and then you should get the results of the inspection within 48 hours. Most of the time associated with this step is related to scheduling a time with the inspector.
Appraisal: Up to 2 weeks
To finalize the application, your lender will send a certified appraiser to the property for the official appraisal. Similar to the home inspection, most of this time is related to coordinating the schedules of the current owner and the appraiser.
Now that you have a better grasp on some of the key steps in the home buying timeline, it’s time to get started! Go find the home for you, whether it takes a month or a year.