While everyone’s timeline will differ depending on goals, constraints, and market conditions, the typical transaction will mirror the following timeline:
Preparation and Search (45 – 90 days)
- Talk to a Lender – Getting started early means you will have an opportunity to clear credit dings, let any deposits season in your account, make necessary arrangements for any gifts, etc.
- Strategic search – Make sure to look at price points above and below your target zone, as well as different housing styles in multiple areas to really gain a feel for the market.
The Contract Period (30-60 days)
- Inspections – Typically, you will have anywhere from a week to two weeks to complete the inspections. The buyer has the right to ask the seller to make repairs and/or credit the cost of the repairs to the purchaser at closing.
- Appraisal – Your lender will send an appraiser to make sure that the price you pay for the home is in line with market values. The lender will use either the appraisal amount or the purchase price, whichever is lower, to establish the maximum loan amount and ensure the loan they offer is consistent with the value established between buyer and seller.
- HOA/COA Review Period – When you purchase a home in either a community with a mandatory Homeowners Association or in a condominium association, the seller is required to provide you the most recent set of Bylaws, Covenants, and Budget. You then have either 3 days (HOA) or 5 days (COA) to review the documents and void the contract with no penalty if you desire.
- The Walk Through – Anywhere between an hour to two days before closing, you and your agent will walk through the home and make sure that the sellers left the house in the condition that was agreed upon and any repairs are complete. Assuming there are no last minute issues, you can move forward with closing.
- Closing – At the appointed hour, you show up at your settlement agent’s office to sign what seems like an incredible amount of paperwork and many large legal documents. You’ll need a certified check for the funds required to close and some form of photo ID. The paperwork you are signing is a combination of loan documents and legal documents that finalize your loan, take possession of the property, and pledge it back to the bank in the case of loan default. Then, they hand you the keys…
- Settlement – Often referred to as ‘closing,’ this is where the title of the property actually changes hands. Your settlement agent will prepare the paperwork, make sure the title to the home is clear, and prepare the Closing Disclosure.