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John Coletti/Getty Images October 19, 2022 Checkmark Bankrate logo How is this page expert verified? At Bankrate, we take the accuracy of our content seriously. "Expert verified" means that our Financial Review Board thoroughly evaluated the article for accuracy and clarity. The Review Board comprises a panel of financial experts whose objective is to ensure that our content is always objective and balanced. Their reviews hold us accountable for publishing high-quality and trustworthy content. Michele Petry is a senior editor for Bankrate, leading the site’s real estate content. Chloe Moore, CFP, is the founder of Financial Staples, a virtual, fee-only financial planning firm based in Atlanta and serving clients nationwide. Bankrate logo The Bankrate promise
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Founded in 1976, Bankrate has a long track record of helping people make smart financial choices. We’ve maintained this reputation for over four decades by demystifying the financial decision-making process and giving people confidence in which actions to take next. Bankrate follows a strict , so you can trust that we’re putting your interests first. All of our content is authored by and edited by , who ensure everything we publish is objective, accurate and trustworthy. Buying or selling a home is one of the biggest financial decisions an individual will ever make. Our real estate reporters and editors focus on educating consumers about this life-changing transaction and how to navigate the complex and ever-changing housing market. From finding an agent to closing and beyond, our goal is to help you feel confident that you're making the best, and smartest, real estate deal possible. Bankrate logo Editorial integrity
Bankrate follows a strict , so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. Key Principles
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers. Editorial Independence
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information. Bankrate logo How we make money
You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey. Bankrate follows a strict , so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers. We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service. Buying a home doesn’t deliver the instant gratification you’re accustomed to in today’s e-commerce world. While you might be able to hit the “Buy Now” button and pick same-day delivery with loads of other purchases, buying real estate requires a number of steps and a lot of patience. And even after you find the perfect place, you’ll still be waiting: The average time to buy a house, from contract to , is currently 50 days, according to . Timeline to buy a house step-by-step
Step 1 Get preapproved
If you’re going to borrow money to buy a house, the first step is to . A mortgage lender will typically ask for information about your assets, income and credit history to make their assessment of how much they’re likely to loan you. In some cases, lenders with online-focused operations can issue an automated preapproval letter on the same day. The letter will serve as evidence to sellers that you’re a qualified buyer. Preapprovals aren’t good forever, though — they typically last between 60 and 90 days. If preapproved, you’ll receive a within three business days after applying for a mortgage that outlines your loan amount, interest rate and other loan details. It’s important to compare options, too. The Consumer Financial Protection Bureau recommends getting loan estimates from at least three different lenders. Before you begin the preapproval process, consider what you’ll look like in the eyes of a lender. Do you have any errors on your credit report? Are you carrying a hefty balance on a credit card? Think about the preapproval process as a chance to show off your best self. Lenders need to feel confident that you will be a responsible borrower. Here’s a general timeline of what you’ll need to prepare before submitting paperwork for a mortgage preapproval: At least 6-12 months before: Start saving up for a (if you haven’t already) so you can show a lender you have the means to purchase a home. Also, try to get a broad picture of your financial situation by checking your credit report and score. Lenders will look at your credit history (and, by extension, your credit score) to see how creditworthy you are. Understanding what’s in your report now will give you a chance to raise your credit score if needed. Then, when it comes time to get preapproved, you have a better chance of landing a better rate. 3-5 months before: During this time, avoid taking out any new loans or making other major changes, like switching jobs. Doing so could affect your eligibility for a loan. Lenders look at your , for example, to see whether you can afford to manage your monthly payments. Keeping the status quo in your finances, income and job situation can help you avoid delays in your loan approval. 1-2 months before: This is a good time to start organizing the paperwork you’ll need to submit for a preapproval. Documents typically include recent paystubs, two years of federal tax returns and two months’ worth of bank statements. Step 2 Find a home
Now that you’re preapproved for a mortgage, you know . That means it’s time to start looking for one. At this stage in the process, you can work with a real estate agent, check out and start house-hunting in earnest. It’s important to note that this step can take more time than you might expect, because . According to the National Association of Realtors (NAR), the country had a 3.3-month supply of homes in July 2022 — that’s up from January’s record low of 1.8 months, but still well short of the 5 or 6 months required for a balanced market. Step 3 Make an offer
Once you’ve found the house you want to buy, your real estate agent will help you submit an . Your agent can help you decide on an offer that’s competitive, aligned with home prices in your area and reflects your best interest. The offer might also include , which help protect you if you end up needing to back out of the offer. If you’re able to make an , you can reduce your time to close. Without a need to secure financing, you won’t have to deal with a financial institution. However, even all-cash transactions require some waiting as the seller works out all the details and paperwork, so keep that in mind. It’s also important to recognize that making an offer is a step you could wind up repeating, depending on how hot your local market is. NAR data from early 2022 indicated that only . But times changed as mortgage rates rose significantly over the course of the year, so the market is not quite as competitive now. Step 4 Go to contract and put down earnest money
If your offer is accepted, you’ll and have to make an , which is an amount of money you put down in good faith to assure the seller you’re serious about the purchase. Think of this as another signal that you’re committed to doing all the work ahead toward actually closing on the house. Step 5 Schedule a home inspection
The next step should be a . Depending on your state’s laws, a home inspection typically needs to be completed within a set number of days after you sign a purchase agreement. If the inspector uncovers any major concerns, you might want to negotiate repairs or , which could take more time. Step 6 Wait out the closing process
At this point in the process, you can expect to do some waiting as your lender moves the loan into . In this time, you may need to submit additional documentation for your lender to clear your loan to close, and the lender will order an to assess the home’s value. The type of loan you take out could alter the timeline slightly, because of the types of assessments and paperwork needed. For example, an currently takes one day less than a conventional loan, according to ICE Mortgage Technology (49 vs. 50). And have historically taken a bit longer to close, due to additional documentation requirements like a VA Certificate of Eligibility. If there have been major changes to your financial situation since you were preapproved, your loan might be delayed as well. Lenders can get a bit spooked if you change jobs, open a new line of credit or make any other big money-related decisions between the time you apply and the time they’ll actually give you the funds. Once your mortgage is approved, your lender will give you a copy of your at least three business days before the closing date. The disclosure lists all the loan details, fees and terms, as well as what you’ll need to pay in closing costs to finalize the purchase. Step 7 Sign the closing documents and get the keys
Finally, after all that work, closing day has arrived. You will need to sign a small mountain of paperwork. You’ll also need to pay , if you didn’t opt to roll those expenses into the loan. And you will likely need to pay with a cashier’s check, as personal checks are typically not allowed. How long does this final step take? It varies, but you should plan on spending at least two hours dealing with all the documents. How to avoid delays when you buy a house
According to NAR, that held up the closing in June, July and August 2022. There are a wide range of potential issues that can create stumbling blocks, including: The buyer has trouble securing financing. The appraisal report comes back with a value that doesn’t match the loan terms. The home inspection report identifies the need for serious repairs. There are . There are issues with hazard and flood insurance. The buyer loses his or her job. One of recently has been an . According to data from CoreLogic, 20 percent of home sales had appraisals that came back lower than the agreed-upon offer price in May of 2021. However, those appraisal gaps became less common by the end of the year. Now, in 2022, , which means that appraisal issues may become less common. The best way to avoid delays is treat communications from your lender as a top priority. If your lender requests additional documentation of your income or employment, for example, respond as quickly as possible. One last simple rule to help make the process pain-free: The earlier you get a head start on ironing out your finances and securing a preapproval, the more likely you’ll have a relatively smooth and quick transaction. SHARE: Michele Petry is a senior editor for Bankrate, leading the site’s real estate content. Chloe Moore, CFP, is the founder of Financial Staples, a virtual, fee-only financial planning firm based in Atlanta and serving clients nationwide. Related Articles