Closing on a House: What You Need to Know


Buying a home is still the American dream. The process of purchasing a home can be truly exciting. You get to spend your time looking online at what are typically beautiful properties.

The real fun then begins when you start touring the ones you like. Your real estate agents will likely show you several properties before you find one that matches what you're looking for.

Once an offer to purchase happens the real work begins. You will not finish the process of buying a home until you finally reach your agreed-upon closing day.

Your closing will be the conclusion of your journey into home ownership. One of the most common questions from home buyers is how long does it take to close on a house. Maximum Real Estate Exposure has some excellent insights into typical closing time frames.

Your desired closing date will be discussed with your buyer's agent. The agreed-upon closing date will need to be mutually satisfactory with the seller.

Once the closing date has been agreed to, it will become part of the contract.

We will be covering the closing time frame, along with other essential milestones along the way. Let's take a look at everything you need to know about home closings.
What to Know About Closing on a HomeDeposit Photos

What is a Closing on a House?

The closing is the conclusion of a real estate transaction. It is when a new deed will be prepared on a property and funds will be exchanged at an agreed upon meeting place.

Most buyers will be getting financing from a mortgage lender. The bulk of what will be signed will be mortgage paperwork and disclosures from the lender.

Two of the most essential documents are the mortgage and deed. These documents will be filed at the registry of deeds.

Once the closing comes to a conclusion, the buyer will be the proud owner of a home.

What's The Average Time to Close on A House?

Once you have signed an offer to purchase, there will be some important steps that take place on the way to a closing. You likely have some essential real estate contingencies in your contract.

These include a home inspection, real estate appraisal, and mortgage contingency. Each of these contingencies must be completed before a closing can take place.

Most real estate closings fall between 45-60 days. Keep in mind a closing date is negotiable. It may be more or less than the average.

Complete a Home Inspection

The first phase includes your due diligence on the property. Research should include the home's history. You should also have the home inspected by a professional home inspector.

They will be tasked with making sure you're not buying a lemon. Home inspectors go over a property inside and out with a fine tooth comb. They will point out any deficiencies they discover.

Usually, your home inspection due diligence period will be around ten days from when you execute the offer to purchase.

If the findings are unsatisfactory you will be able to cancel the contract.

The Home Will Be Appraised

When you are getting a mortgage it is likely your lender will want a real estate appraisal completed. Sometimes lenders will waive the appraisal if you are putting a down payment larger than twenty percent.

Within the contract, you will be given the option to have an appraisal contingency. The appraisal contingency will state that the property needs to appraise for at least the sales price.

When it does not, a buyer would have the option of terminating the sale. In hot real estate markets, buyers will often waive their appraisal contingency.

Waiving appraisals are done to strengthen the appeal of an offer. It gives the seller comfort a buyer is not going to bail from the transaction if the appraisal is lower than expected.

Typically, when there are appraisal issues they get worked out.

You'll Need to Get a Mortgage Commitment

One of the last phases in your home buying journey will be getting a mortgage commitment from your lender. The typical time frame for procuring financing is 4-6 weeks from the execution of the contract.

Some lenders can get buyers approved quicker than others. The volume of loan business at the time is often a factor. If there is significant re-finance volume happening at the time, a commitment to lend could take longer.

Getting your financing will be the last big hurdle. There are several things you need to avoid doing before closing day. One of the most significant mistakes is making a large purchase like a car that could throw you debt to income ratio out of line and force the lender to cancel your loan commitment.

What Will You Be Signing on Closing Day?

There are several vital documents that will be signed by a home buyer on closing day.

Some of the paperwork you'll be expected to sign include the following:

  • The promissory note which is the document that commits you to repay the loan.
  • The mortgage is a document that protects the lender's right to foreclose on the house if you fail to make your payments. It is also known as a Deed of Trust.
  • The escrow disclosure which provides the details of your monthly payment obligations with the lender.
  • The cancellation period is three days after signing the contract. If you have any concerns, you may cancel the contract without losing the home or money. The document that covers this is the right-to-cancel agreement.
  • You will also need to carefully review and sign all disclaimers, disclosures, and government documents the lender asks you to sign. Many of them will be boilerplate forms.

If you are a first-time home buyer, it will be useful to have a real estate attorney. There are many things a real estate lawyers does for home buyers and reviewing documents is one of them.

For what an attorney charges it's worth it.

What Will a Buyer Need to Bring to Closing?

Before the signing, consult with your attorney or agent to determine what documents you will need. It is likely that you will need to bring the following items:

  • Identification documents, such as a passport or driver's license, will be required.
  • The Closing Disclosure that you have received must be compared to the final documents three days before the signing,
  • A bank check making up any difference between your mortgage, down payment and the home's purchase price.

How Long Will Closing Day Take?

The time it will actually take for closing day will depend on how quick you are to sign the presented paperwork.

Most buyers will sign as it is presented to them. However, if you like to read everything you're signing it could take a while.

Most closings take around 45 minutes to a little over an hour to complete.

Final Thoughts on Home Closings

You are now up to speed on the process for closing on a house. The process will probably seem longer than it really is due to your excitement of getting into a new home!

Comments / 4

Published by

Bill Gassett is an avid writer for numerous real estate topics including finance, mortgages, moving, home improvement, and general real estate. His work has been featured on numerous prestigious real estate publications.

Massachusetts State

More from massrealty

Comments / 0