Buying or selling a house is a pretty exciting time in your life. It means you are making a move to a new place, with new opportunities and, perhaps, a new lifestyle. It’s normal to be excited. For folks who are buying a house it is a time of excitement to start fresh in the beautiful new home. For folks who are selling, they are probably looking forward to a move and also to the financial rewards of having owned and cared for a home. Additionally for sellers, time literally is money. Each additional day in escrow is one more day of paying taxes, insurance, and interest. So closing early is very attractive.
The typical loan can be put together in 30-45 days. There are even lenders who promote that they can close a loan in 2 weeks. I have seen that happen on one occasion. It was a builder and my client-buyer used the builders loan program. We went from contract to keys in 2 weeks. That was a motivated builder!
As much as a quick close is appealing and can be done, it really adds pressure to the buying experience. To close in 30 days or less you pretty much need to order the appraisal at the time that agreement is reached in the contract, which is prior to getting your home inspection. Because appraisers are now done by third party companies, this means that the appraisal has to be paid for whether you buy the house or not. So if the home inspection does not go well, it is money lost.
It also creates pressure the week of closing. Federal guidelines require that buyers receive a disclosure statement from their lender outlining the exact closing costs. This must be received and signed not less than 3 days before actually signing the loan documents. Then remember that most lenders want at least 24 hours after you sign your loan documents to review the papers before releasing the funds to close.
This is all about my suggestion that you go for a time line of 40-45 days. It just simply takes the pressure off and makes the experience more enjoyable. I know, I know, you want to be in by Thanksgiving….I’ll do whatever it takes to make it happen!