Buying a new home is exciting, but the wait to get the keys to your new abode can be a lengthy one. So, just how long does it take to close on a house?
The homebuying process can easily take a month or longer when you’re financing a home purchase, but the exact timeline depends on a variety of different moving parts. Mortgage underwriting, the appraisal, the home inspection, and how responsive you are to your lender’s requests are all factors that determine how long it takes to close on a house.
How long does a house closing take?
Finalizing your house closing may be one of the stressful parts of homebuying. The average time to close on a house or home purchase with a conventional mortgage is 52 days as of December 2021, according to data from ICE Mortgage Technology, a loan software firm.
You can expect to wait several days longer to close your home sale if you’re financing it with a government-backed mortgage such as Federal Housing Administration (FHA) or U.S. Department of Veterans Affairs (VA) loans. Purchase mortgages tend to take longer (an average of 54 days) compared to refinancing (45 days on average). Overall, the average time to close on a mortgage of any type, including refinancing, is 49 days.
The reason for this wait is because of what happens during a house closing. From the time you sign a purchase agreement until you sign the closing paperwork, there are many closing steps to complete — including depositing your earnest money in an escrow account, ordering a title search, and scheduling both a home inspection and appraisal. If the home you’re purchasing is an older one, has been through a foreclosure or a short sale, or the home inspection turns up the need for extensive repairs, your timeline to closing might be even longer.
Closing on a mortgage vs. closing with cash
If you pay cash for a home, you could close in as little as a week or two. The time to close on a home paid with cash is a lot faster, because you don’t have to apply for a mortgage, go through underwriting, get an appraisal, or provide income verification, among other time-consuming steps in the mortgage approval process.
The seller may still want to verify your available funds by looking at your bank statements or other financial documents. But you also have the option to forego common contingencies if you’re in a rush and willing to assume those financial risks.
Closing on a government-backed FHA, USDA or VA loan
If you’re applying for an FHA or VA loan or a mortgage guaranteed by the U.S. Department of Agriculture (USDA), it might take several days longer to close on your home purchase than the average for a conventional mortgage. That’s because these loan programs typically require lengthier home appraisals and safety inspections, and borrowers may have to provide additional information on household income and other financial details to ensure they meet the program requirements.
As of December 2021, FHA loans took an average of 54 days to close while VA loans took about two months (62 days), according to ICE.
Closing on a house process and timeline
Each step in the closing process takes time to complete. However, the exact number of days that closing on a house steps can take will depend on how quickly you, the seller, and your real estate agents communicate and respond to documentation requests.
Here’s a look at a typical house closing timeline with an estimated number of days for each step in the process. Keep in mind that some steps in the closing on a house process can be done at the same time or overlap to make progress faster. For your part, be sure to respond to any mortgage questions or notifications in a timely manner to make sure missing documents on your end aren’t holding up the process.
How long to close on a house?
|Steps to closing on a house||Estimated time|
|Sign purchase agreement||1-7 days|
|Deposit the earnest money in escrow||1-3 days|
|Complete title search||3-14 days|
|Do the home inspection||5-14 days (plus time for any repairs)|
|Get an appraisal||5-14 days|
|Mortgage application and underwriting||3-30 days|
|Closing day||1 day|
Be ready to submit your earnest money deposit via check or bank transfer within three days of signing a purchase agreement. In a competitive real estate market with multiple bids above asking price, things can move very quickly. In other words, you’ll want to lock down the agreement as soon as possible.
Once you have an accepted offer and signed the purchase agreement, your lender can order a title search and you can schedule a home inspection. If the home inspection report reveals that certain home repairs are needed, negotiate with the seller to get those taken care prior to closing, or see if the seller will lower the purchase price so you can handle the repairs yourself later on.
How fast can you close on a house? How to avoid delays
Obviously, the fastest way to speed up a closing is to buy the property with cash. But if you’re like most people, you’ll need a mortgage from a bank, credit union, or mortgage lender to buy a house. In that case, making sure your documents are in order and ready to go and you respond quickly to your lender’s requests are key steps to ensuring a quicker closing process.
With so many components involved in what happens at a house closing, however, all it takes is one delay to drag out your homebuying timeline. A frequent source of closing delays is the home inspection. To find a good home inspector, ask your real estate agent, friends, or family members for their recommendations and try to book early.
Another common reason for a delay in closing is appraisal issues. Appraisers might be booking out several weeks or require extra time to complete their report for one reason or another. That can extend the time frame when it comes to how long after the appraisal is closing. Additionally, if the appraisal comes in lower than expected, you’ll need to work with the seller to see if they’ll lower the home price, come up with the difference yourself, or potentially back out of the purchase if you had an appraisal contingency in your offer.
Ready to explore your mortgage options? Reach out to a local Finance of America Mortgage Advisor today to learn more.