Looking to buy a new home? You might be wondering how long the mortgage and sale process could take before you can eventually get a new home. Here's the thing, the entire process cannot be completed overnight. But if you put in high levels of effort and you get a professional's assistance, you can definitely shorten the loan application process. Here is the summary of the whole application:
Let's say you've found the home through online listings. Now, you're probably wondering how long it would take for that home to be yours. Here's a quick forecast on what's gonna happen next. First, you need to shop for loans. Just like in buying other important stuff like car or appliances, you would need to compare the advantages and disadvantages of different loans.
You can compare using online tools or you can also get a mortgage loan officer's assistance. A mortgage officer will help you get your credit report and at the same time give you an estimate of interests, closing costs, and loan terms.
FICO allows you to do some 'rate-shopping' for mortgages without dinging your credit score repeatedly. If you could do the shopping within 14 days, credit bureaus can ignore the subsequent dings each time your credit is being pulled.
Next, you have to get pre qualified. This step is really quick and can just go from 1-3 days. This is when the lenders give you a prequalification letter with a rough estimate of the loan you can receive, and this may also just be based on your verbal reports about your financial status.
The next step for you is to get a lender's pre approval. In this stage, lenders will verify all your financial claims and you may be required to submit necessary proofs. Once you get pre approved, a conditional letter will be sent to you, showing the amount of loan you can be given. This phase can last from a week to several months.
Finally, with a pre approval letter, you can already make an offer on your prospect home. Once the offer is accepted, the lender will need to appraise the property before you buy it. This is to ensure that the home's price is reasonable basing on the current market. The time frame required in this stage depends on the schedule of the appraiser to check the property, alongside the seller's availability. You can get the appraisal result within just a couple of days.
Overall, the time needed depends on many factors. Although it can cost so much of your time especially when taking into consideration the important people's schedule, it can also go fast if there are no issues regarding your application. If all your documents are prepared, your credit score is in good shape, and you have a hard working real estate agent, it is possible to finish the process in just a few days. There are some who finished the loan arrangement in just 14 days. But still, it's better to take enough time assessing each option and finalizing your decision.