In tabulating the total length of a conventional home sale, we must examine each separate phase of the transaction.
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What kind of timeline can buyers and sellers expect in a conventional home sale? For a comprehensive look, let’s break the process down into each separate phase.
The first phase is the attorney review. This takes place after an accepted offer has been put in place and both the buyer and seller sign off on the contract. The contract goes to both of their attorneys for review, after which the buyer’s attorney makes any revisions or recommendations they see fit and sends a rider to the seller’s attorney, which is basically a proposal in addition to the contract. The seller’s attorney then makes their own revisions and sends it back to the buyer’s side. Once both sides agree to the rider and sign off on it, you can exit attorney review. Phase length: five to seven days.
From there, we move on to the inspection phase. Generally, a buyer will have a right to an inspection where their inspector will look at the home and make any recommendations for repairs. That recommendation will go to both attorneys. They’ll then decide if any repairs need to be made by the seller, any credits are due from the seller, or if the buyer will accept the home as-is. Phase length: eight to 10 days.
After the inspection is completed, the appraisal phase begins. The appointed appraiser will reach out to the buyer or seller side and schedule the appraisal. They’ll measure the interior of the home and put a comparable report together to submit to the bank. Phase length: seven to 10 days.
The next step is the mortgage commitment phase. This is the phase in which the appraisal is sent to the bank and goes to underwriting for approval. The underwriting department examines all the financial factors and checks the buyer’s criteria to make sure everything lines up with the loan. Phase length: 14 to 21 days.
“CONVENTIONAL HOME SALES TAKE LONGER THAN CASH PURCHASES.”
After the mortgage commitment has been issued, the title search phase happens. The title company will take a look at the transfer history of the property and see if there are any additional parties that claim ownership of the property that haven’t been involved in the sale up until that point. Once those variables are settled and the title company deems the title clean and clear, they’ll issue title insurance. Phase length: seven to 10 days.
From there, we come finally to the clear to close phase. This is the final review from the bank to make sure the buyer is financially stable. Phase length: five to seven days.
Once the clear to close phase commences, each side is free and clear to complete the home sale. If you’ve been keeping your math at home, your total timeline for a conventional sale is 46 to 65 days.
Keep in mind, a conventional sale means having a mortgage involved. If the home sale is a cash purchase, the appraisal and mortgage commitment phases aren’t necessary. Subtracting them makes a cash sale timeline anywhere from 20 to 27 days. Generally, you’ll see closing dates for those transactions set anywhere from 30 to 35 days out. Cash sales are typically more attractive to sellers.
As always, if you have any questions, please feel free to give me a call or send me an email. I’m happy to help.
