Timeline For Closing on a House

Closing on the sale of your home is undoubtedly one of the biggest life events you’ll go through. There are so many things to consider before and after signing the final paperwork that transfers the house you’ve called home for so many years to its new owner. 

The process of selling a home can be daunting, especially for first-time home sellers. To make things as easy as possible for you and your family, here is a step-by-step closing on a house timeline.

Sign Purchase Agreement

The first thing you’ll want to do after you accept an offer on your house is to sign a purchase agreement. A purchase agreement is a legal contract that outlines everything from the price, to the terms of the sale and the expected closing date. 

Open Escrow Account

Once you’ve signed the purchase agreement and the real estate agent has taken care of the details, your closing agent or title company will open an escrow account. This is a separate account that the buyer will deposit an earnest payment into and then disburse the rest of the purchase price to the seller once the sale is finalized. 

This account is held by a third-party escrow service and the only way the seller or buyer can access it is if there’s a dispute, such as if the buyer backs out of the deal or an inspection reveals problems with the home. Having an escrow account protects both you and the buyer in case anything goes wrong and the deal falls through.

Schedule Home Inspection

Once the escrow account is open, the next step is for the buyer to schedule a home inspection. A home inspection is an examination of the interior and exterior of the house to make sure it’s up to code and in good condition. The inspector will identify if there are any problems with the house,what repairs are needed, and how much said repairs will cost. If the repairs are too costly or expensive for the seller to manage, the buyer can ask for concessions or walk away from the deal.

Get Home Appraised

Once the seller receives the home inspection report and knows about the repairs that need to be made, then the home must be appraised. An appraisal is a professional opinion of the value of a property, based on a reasonable market analysis. This helps both you and the buyer know what the actual market value of the house is so neither one of you can artificially inflate or deflate the price. 

Wait for Mortgage Underwriting for Buyer

Once the home inspection is complete and they get the appraisal, you’ll want to wait for the mortgage lender to complete the mortgage underwriting for the buyer. A mortgage loan is the source of financing for the purchase of a home. Your mortgage lender performs a wide range of checks to ensure the loan meets the underwriting guidelines set by the bank. These guidelines include ensuring their income, employment status and debts are within the parameters they’ve determined are safe and reasonable. 

Once the lender completes the underwriting process, they will provide the lender servicing the buyer’s loan with a loan commitment letter. The loan commitment letter is essentially an agreement between the buyer and the lender which defines the contract and sets the closing date. If the buyer is unable to secure a mortgage, this could cancel the closing and the seller would have to find another buyer.

Clear Title for Property

Once the mortgage underwriting process is complete, your title company will clear the title for the property. This means the title company will clear the title with the government to prepare it for sale. This is necessary as a condition of selling the property. The title company will conduct a check of the property ownership history to determine if there are any liens or other claims on the property. 

In addition, they’ll also perform a title search to make sure the seller is indeed the owner of the property and there are no outstanding judgments, court orders or tax levies that could pose a problem when transferring ownership. The title search can identify any issues with the title and allow you or your real estate agent to address them before they become an issue.

Attend Final Walk Through

At this point, the buyer will want to have the final walk through with their real estate agent to make sure everything looks and functions as agreed, and that the inspection and appraisal reports are accurate. The final walk through is exactly what it sounds like: the new homeowner takes a physical tour of their house right before closing. The purpose of the final walk through is to make sure the house that the buyer is buying is in the condition they agreed to when they bought it. During the walkthrough, the buyer party will make any corrections to inaccurate documentation to ensure there are no last minute surprises on the seller and buyer side on closing day.

Not all sellers choose to attend the final walk through. However, it can be very helpful for the buyer. This way, they will be able to identify any issues or problems with the house that aren’t detailed in the inspection report from the home inspector. For instance, a wall might have been damaged in the process of the seller vacating the property. It’s important to do a final walk through to make sure that everything in the property is exactly the way the buyers saw it from the very beginning when they did their initial appointment or home inspection. 

Sign Paperwork for Closing

The last step in the process is for the buyer and seller to sign paperwork during the closing. This is known as the closing and it’s when the transfer of ownership from you to the buyer takes place. Once everything is signed, you will receive a check for the balance of your home sale proceeds, minus any closing costs that were due at closing.

The closing can be a stressful process. If you’re not sure about something, you don’t have to sign it. Closely examine the paperwork and then ask your real estate agent or the title company to clarify anything you don’t understand before you sign it. If there are last-minute issues that come up, your closing agent can help smooth out any potential roadblocks.

There will be a lot of moving parts during the house-selling process and it can be a little overwhelming. The timeline above can help you make sure everything goes as smoothly as possible. If you find yourself in a situation where you have to sell your home quickly, you can use the timeline above to help you get it sold as quickly as possible.

Frequently Asked Questions About Closing on a Home

It is natural for buyers and sellers to have questions about the closing process. Some of the most common questions sellers have during the closing process include:

1. How Long Does it Take to Sign Closing Papers?

It can take a few hours for buyers to sign closing papers. However, it can take less than 20 minutes for sellers to fill out closing papers. You can save yourself some time by doing all the paperwork before you meet with the buyer if your title company allows it.

2. How Long Does it Take to Close on a House After an Offer is Accepted?

The time it takes to close on a house after the offer is accepted can vary depending on many factors. The traditional buying process where a buyer must obtain a mortgage can take two to six weeks. With the all-cash option, where a buyer is not required to have a mortgage, this can be as fast as one week.

3. Can You Close on a House in 2 Weeks?

Yes, it is possible to conduct a closing on a house in as little as two weeks. The key is to get a cash buyer that does not need financing. If the buyer does need financing, this could take longer. Plus, selling your home for cash can save thousands of dollars in closing costs. 

4. How Long Does it Take to Close on a House After Inspection?

How long after inspection closing occurs depends on what the inspector finds.  If the inspector does find problems, the seller may need to engage a contractor for repairs. This can extend the process by several weeks, depending on how extensive the repairs are and how long it takes for a contractor to complete them.

If the repairs are costly or substantial, the buyer could walk away from the deal or the seller could agree to accept a lower purchase price to account for the repairs. When inspections do not find anything substantial, this process won’t add much time to the closing timeline.

The sale transaction process can take two weeks or longer, depending on how quickly you and the buyer agree to all details of the sale. If you run into issues while under contract, this can delay the closing process.

One good way to make sure that everything gets done in time is to have a timeline and checklist of what still needs to be done before closing. Sale timelines vary based on many factors like whether a mortgage is involved and if repairs need to be completed before closing.

Many sellers want to know: “How fast can I close on a house and get the funds?” There are ways to sell a house fast that save you time in between the offer and closing. You can opt to sell a house without a Realtor and to sell a house AS IS to House Buyers of America. 

To get started, give us a call at 855-659-3289 or fill out our online form to get a cash offer today.