How Long Does It Take to Close?

An offer to purchase should include target dates by which each step of the process should be complete. It should list dates for completion of each inspection and associated dates by which you must report the results to sellers if you ask for repairs. There should be a deadline to meet the loan commitment, the bank's formal approval of your loan. One of the most critical dates is the projected date of closing.

If your contract states, time is of the essence, it means that dates are rigid unless each party agrees to change them. In some states, stated dates are more flexible, and the contract remains valid if an event goes past the deadline, but takes place within a reasonable length of time (often thirty days).

Your bank will probably preapprove you for a loan, but loan commitment doesn't take place until much later, after the appraisal is back and both you and the property are approved and on the way to closing. Don't confuse the two terms when inserting dates in an offer to purchase.

The typical length of time it takes to close a property varies from region to region and by the type of property you are purchasing. An attorney or experienced real-estate agent can give you a good idea of realistic timeframes that should be used for the events associated with your contract.

The final closing date is often dependent on your contingencies. For instance, if you require a survey, but all of the surveyors are booked for the next six weeks, you won't be able to close in thirty days.

The same is true of inspections for septic permits. In some areas, it might take as much as three to four weeks for that type of inspection to be performed. Since you probably don't want to tie up too much time and money on other issues before you are sure the land will be suitable for a septic system, you'll want to move your closing date forward and perform other tests after you know a septic system is doable.

When you're estimating a closing date, you should always determine the order in which contingencies should be handled so that you invest as little as possible into the transaction until you become confident it will close. For instance, don't pay for an expensive survey until you have the results of the home inspection. Don't perform special home inspections until you know the outcome of the first. If you think the property might not appraise at or above the sales price, don't do any extra work until a positive appraisal comes back.

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