Closing on a house involves a series of progressive steps that culminate in a final closing event. Each step in the process, starting with information gathering and verification, moving on to document preparation and finally to signing the closing documents takes time – and often a large dose of patience - to complete. While you can use a general time frame as a guide to determining how long takes to close on a house, the exact time varies depending on the type of loan and your individual circumstances.
It generally takes 30 to 60 days to complete the process of closing your home loan, starting from the moment a seller accepts your offer to purchase and ending with a final one-hour meeting. Look at your offer to purchase as a first indication of how long you can expect this process to take. If you do not specify a date when you submit the offer, the seller most often will. Understand, however, that this is a goal and not a date set in stone.
Part of the reason for the time frame is the numbers of individuals and/or groups who play a role in helping to close on your loan. These include your real estate agent or attorney, loan officer, mortgage underwriter, document processors, home inspector, real estate appraiser and representatives from the title office who preside over the closing ceremony. Each usually performs a single function, and each charges a fee for her services. Plan to spend about 1 percent to 2 percent of the purchase price of your home to pay for closing services.
In addition to securing final approval on your mortgage loan and locking in an interest rate, the process involves making sure the home is worth what you are paying and that the title to your home is free and clear. Your settlement agent may order a land survey, appraisal and/or a home inspection in accordance with requirements of your lender and your personal preference. Researchers investigate public records for past due state and local taxes, as well as recorded judgments. If the seller has an outstanding mortgage, closing documents will reflect the amount the seller is to pay to clear the amount due.
The Big Day
The deed or title to your home -- as well as the keys -- transfers to you as the final step in closing on your home. Expect to bring along personal identification and a cashier's check for any money you owe for closing costs and the remainder, if any, of your down payment. Documents you can expect to sign on closing day include a Truth in Lending Statement, an itemization of the total amount you are financing, monthly payment breakdown, personal guarantee note and the mortgage lien. There may be additional signing requirements depending on the loan and the area in which you live.