What does closing on a house mean?
Whether you’re in the middle of your journey to home ownership or just want to become familiar with the house buying process before making any moves towards ownership, you’ve probably heard the phrase “closing on a house”. Or similar phrases, such as “closing day” or “signing day”; all of these terms reference the end stage of the house buying process. Closing on a house has a little bit more to it than it may seem.
Continue reading to learn more about what it means to close on a house. If you haven’t started your journey to a new home, you can get the process moving by starting your application.
Closing on a home: Definition
Closing on a house means that you are in the final stage prior to home ownership and now you’re just a few weeks (or months) from getting the keys to your house.
In legal terms, the contract between the buyer and the seller is settled. During the closing stage, you will have to handle several contingencies prior to closing on the home. These items will be listed in your contract. There are a few common contingencies that can happen during the closing period that you will want to be prepared for:
- Home inspection: Getting an inspection on your pending home purchase is beneficial for you as it can uncover any flaws in the property prior to ownership. Some mortgage lenders do not require a home inspection, but as the buyer it is a good idea to complete one.
- Home appraisal: An appraisal is not the same as an inspection. A professional will inspect the property, but the focus of the appraisal is to determine the home’s value. Besides the property, the appraiser will also consider the value of nearby homes and the current market. Appraising the home helps your lender determine how much money to lend you.
- Homeowner and title insurance: Homeowners insurance protects you in the case that your home needs repairs or to be rebuilt. The cost of your homeowners insurance is added to your monthly mortgage payment. Title insurance is to protect you and the lender against a faulty title on the home, this is a one time fee.
- Closing disclosures: This is a document that outlines your mortgage agreement. You will have time to go over this document and perform a final walk-through of the property prior to signing.
How long should it take to close on a house?
The time it takes to close on a house can vary depending on whether there are any delays in the closing process.
It can take 30 days or more to close on a home. Being prepared will help you shorten the closing time. If additional information is needed, provide it as quickly as possible.
The items and documents we’ve reviewed can also play a role in the timing of the closing period. Getting them done as soon as possible can help speed up the time to getting your new house keys in your hand.
How can I get started on owning a home?
There are many delays and obstacles that can come in the house buying process, especially during the closing stage. Having a team to help you navigate through this journey can help you have a better experience and get the most out of home. If you are looking to get started on owning a home, let us partner with you along this journey.
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