The benefits of owning a home on your own piece of land cannot be overstated.
You no longer have to rely on other apartment tenants to observe the quiet rules, or other quirks they may impose on you.
You can make as much noise in your house as you want, at any time of the day.
To a large extent, you can improve your home and land without asking for other people’s permission.
You have your own land for gardening, food production, relaxation, and pet activity.
Truly, buying a home is elevating your social status and wellbeing, not to mention solidifying your inheritance for your children.
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Buying a house or building your own?
Ideally, in order to get yourself a house that is perfectly suited just for you, you would have to have it built from scratch. This would make it possible to include just the number of rooms and configurations you need, along with the inclusion of the latest building materials and technology, which would ensure a comfy, energy-efficient home.
Unfortunately, building your own house would take at least a half a year. To build your own house, you have to start from finding the appropriate land, buying it, finalizing architectural and engineering projects, connecting all the infrastructure, and getting all the licenses and paperwork in order. It may even be cheaper in the end due to all the effort and time involved, but most people prefer to buy a finished house to avoid all the hassle.
Furthermore, the reason why so many people want to buy an already built house instead of building their own is due to location considerations. It is quite difficult to get a plot of land in an area that has already been developed; one that has all the amenities you would expect and require from modern civilization.
Another reason is that the time to become a homeowner is drastically reduced if you just buy a house instead.
How long does it take to buy a house?
Theoretically, it can take forever to buy a house if you have preferences that are hard to meet!
Joking aside, we can break up the average house-buying time with the following phases of acquisition:
Shopping and house-seeing through all the interesting offers take about 30-60 days.
Closing the contract takes about 14-60 days from the initial agreement.
If you opted for a mortgage, it takes about 14-45 days before the first payment arrives.
In short, you can expect to buy a house as soon as 30 days, or as long as six months. It all depends on the specific market you are interested in and the time of the year. On average, you can count on at least three months before you finalize your house purchase.
How to conduct your house search?
Thanks to the internet, finding a house has never been easier as all the databases, real estate agencies, and advanced search filters have moved online, for free. In the comfort of your home, you have powerful online tools at your disposal to hone in on exactly the type of house you want to buy:
House surface area
Land surface area
Number of rooms and bathrooms
And many more.
Some house search websites have more advanced search filters than others, but the key is to take full advantage of every single search field. By doing this, you are more likely to find the exact match you want.
Inevitably, you will get fewer results with all the search filters applied. If you are not happy with those results, start removing search filters one by one, in order of importance. Eventually, you will get what may be a match. At that point, it is time to contact a real estate agent for an in-person view of the house.
Another thing to keep in mind is to combine the search results with Google Maps. If the website you are using doesn’t have integrated Google Maps function, it’s always a good idea to see both satellite and street view to get a sense of the area. Just make sure to note when those images were taken. It takes a couple of years for Google to update their maps.
Some house-hunting websites took a step further and offer extremely useful features such as 3D tours of each room, or even VR integration!
Sadly, this is still not a mainstream standard. It will all depend on the real estate agency, the region you select, and your budget.
Related: Buying A House Checklist
Dealing with money and paperwork
Finding the right house was the easy part. Dealing with the paperwork is the hard part.
(Just imagine the paperwork involved if you were building your own house.)
To demonstrate your seriousness in finalizing a house purchase, you have to ratify a contract. Any real estate agent is required by law to give you a reply on your offer within 48 to 72 hours.
Then, it will depend on how much you negotiate the terms of purchase, and how skilled your real estate agent is.
This is the time period referred to as contract-to-close.
After your offer is approved, it is time to call for the home inspection. Each state regulates this differently, but generally, a home inspection should be completed under ten days upon signing the purchase contract.
If the home inspection reveals unknown issues, the contract needs to be negotiated in order to include repairs or seller credits. If you are unfortunate enough to deal with a major issue, like a faulty septic tank, contract closing may be delayed by weeks.
Now, depending on how you choose to deliver the money for the purchase, you can have two divergent time frames until the purchase is completed.
If you are buying a house with cash from a direct bank transfer, the time it will take will be the shortest. As short as the real estate agent and your bank will allow for. On average, the entire process will be done within a week or two. And even sooner if the bureaucracy facilitating the title searching and issuing new owner documents is good at its job.
If you are buying a house with the help of some kind of financing mechanism, that’s another story altogether. Expect at least one to two months for the purchase to finalize.
Moreover, you must be aware that the last big economic crash was largely a result of the house market crash. Therefore, new loan guidelines, launched in October 2015, actually increased the time it takes to complete a house purchase to 45 days on average.
Some loans are even more time-demanding. USDA, FHA, and VA loans, to name a few, take longer. You will find that this process is rather frustrating. At one point you will be required to amass a large collection of documents, while at another point there will be nothing to do but wait for the loan approval. In any case, account for at least two months spent on the loan approval process.
Upon the approval of your mortgage, you will be given a copy of your closing disclosure, which details:
Terms and fees
Closing fees for finalizing the purchase
For closing disclosure to be issued, you can expect no more than three business days.
Additionally, if you are accounting for mortgage payment into the buying process, the time-frame may vary.
Usually, the first mortgage payment arrives on the first of the following month. Exerting some cleverness, you can defer this inevitability. For instance, by closing on April 15, your loan facilitator can prorate your interest and taxes, making your first mortgage payment arrive on much later – up to June 1.
Don’t shy away from exploiting such loopholes given your state of residence. It is perfectly legal, and you will give yourself some much-needed breather from the financial woes.
Related: Mezzanine Loans
When buying a house, preparation is the key.
Finding a house can take as long as you are comfortable with, but finalizing a purchase is when things get out of your hands.
This is especially true if you are financing the purchase instead of buying it directly with your existing cash on your bank account.
These two scenarios offer completely divergent time frames for a house purchase to be finalized.
The first scenario usually doesn’t take more than two weeks, while the second one may protract for up to half a year.
Therefore, make sure you have prepared your financing in advance:
Save for a down payment to demonstrate credibility to the loaner.
Have a good credit history record.
Avoid taking any new loans at least three months before taking on the house mortgage.
Whatever bureaucratic and banking trials you have to conquer, in the end, it will be all worth it when you have a place to call your home.