How long does it take to buy a house? I have heard this question with repeated rapidity each day the last month and I suspect it will continue to increase as we approach the deadline that is November 30th of this year. Why?
If you have been in a cave or focusing on the Cash for Clunkers production, then you may have missed that $8,000 tax credit for first-time homebuyers that close by November 30, 2009. It IS a great deal since there is no repayment of the credit (unlike the previous years cumbersome repayment of the $7,500 credit).
Suddenly as Summer rolls into August, people are getting off the fence, beach or mountains and saying “Hey, maybe I should buy a house!” So, they call someone like me and say “How long does it take to buy a house?”
And since I’m a smart aleck, I say: “Do you have cash?” and we both laugh and I give the following explanation:
To buy a house in the most logical, sane manner, the first step in Minnesota is to visit a Home Stretch Class. It will give you a tremendous overview of the process you are about to dive into and you will be infinitely more prepared to buy a house. You can find classes throughout Minnesota at www.hocmn.org or go to our website at www.adsmn.com to register for our class.
Next, you need to visit a loan officer and get pre-approved. By that I mean, you get to the point where you share documents and information with the loan officer, they run you through their systems and give you a pre-approval letter, Good Faith Estimate and Truth-In-Lending statement. If you don’t have these, you haven’t been pre-approved. Period. End of story. If a loan officer hasn’t seen your paystubs, looked at your credit and gotten a couple dozen documents from you, then you are merely pre-qualified which means NOTHING!
So, make certain your loan officer has you pre-approved and will give you a letter that represents that clearly to a real estate agent. Once you are pre-approved, you can go shopping. Find a Real Estate Agent you trust. Interview a couple or get a reference from a friend or family member. Referrals are the number one source of business for Real Estate Agents especially for the ones who do a good job.
So, how long does this part take? Somewhere around a couple weeks as long as you do your class, meet with the loan officer and deliver documents and find a Real Estate Agent you like.
Your home search? It could take anywhere from a weekend to a month or two if you’re looking for that perfect house. Once you find the home and make an offer on it, that process can take anywhere from a couple days to a month as well. It may take a month if the Seller is a bank or liquidation company and the offer needs to get through their system (though these time frames have been a bit better of late).
Once the offer is accepted, you’ll be able to close in something like 30-45 days since there is still plenty of title, appraisal and paperwork to do. It can be quicker but I wouldn’t want to bet $8,000 on it!
So, how long does it take to buy a house? Looking above, you could do it in two months but more likely you’re looking at 3 months which means time is running out for you and your $8,000 payday. If you are looking to close by November 30, 2009, the time is NOW for you to move forward.
I’m busy answering the phone and e-mails but I’d be happy to slip you in to get pre-approved or to go out and buy a house. Judging on the phone calls and e-mails I’m getting, the next 60 days we’re going to be even busier than we have been! Let’s go!!!!
RW 651-774-9200 ron.williams@adsmn.com