After months of searching and having several offers rejected, you’re finally under contract. Congrats! But how long will you have to wait until you can close on the sale? The average time to closing for all mortgage types is around 43 days, according to the most recent data from Freddie Mac, the government-sponsored enterprise that buys mortgages.

However, the timeline to close depends on several factors, including the type of mortgage and lending institution, as well as the housing market and economy in general. Understanding the factors that influence time-to-close rates can help you prepare better for the mortgage closing process.

Closing Timelines by Mortgage Type

Average closing timelines for mortgages on the purchase of a home tend to rise and fall from month to month. Keep in mind that these are avera♒ges; your timeline may be shorter or longer dependin𝄹g on the specifics of your situation. Here are some sample timelines for different types of loans.

Conventional Mortgages

澳洲幸运5官方开奖结果体彩网:Conventional mortgages are the most common type of mortgage. They are made through private lenders, such as banks and credit unions, and they usually require a higher credit score to qualify than a government-backed loan does. Conventional mortgages typically offer lower monthly costs than some other types of loans, including FHA loans. Costs decrease further for borrowers who can make a down payment of 20% or more, which allows them to forgo 澳洲幸运5官方开奖结果体彩网:mortgage insurance.

Conventional mortgages include conforming conventional loans, which 🤪meet the requirements set by government-sponsored enterprises Fannie Mae and Freddie Mac; jumbo mortgages, which exceed the lending limits imposed by government-backed companies; and adjustable-rate loans, which offer interest rates that fluctuate with the market after a certain period.

In Aug. 2021 (the most recent complete figures available), it took an average of 48 days to close on a conventional mortgage on a home purchase, according to ICE Mortgage Technology. The average time to closing in Jan. 2021, seven months earlier, was 54 days.

Federal Housing Administration (FHA) Mortgages

澳洲幸运5官方开奖结果体彩网:Federal Housing Administration (FHA)🌄 loans are mortgages that are insured by the government and offered by lenders that are approved by the FHA. These loans are designed to help low- and moderate-income families afford their own homes. FHA loans have lower down payment requirements (3.5%) and lower credit score requirements than other types of loans. Although these loans are easier to qualify for, mor🐎tgagees pay both upfront and o🗹ngoing mortgage insurance premiums on these loans.

It may take a bit longer to close an FHA loan due to additional documentation requirements. All mortgages have to meet the lender's requirements. However, FHA loans must also meet the minimum eligibility criteria established by the Department of Housing and Urban Development (HUD), which sets the guidelines for the FHA mortgage insurance program.

In Aug. 2021, ICE Mortgage Technology found that FHA loans took an average of 51 days to close. However, seven months earlier, they took 61 days, on average.

♒U.S. Department of Veterans Aff🐷airs (VA) Mortgages

U.S. 澳ᩚᩚᩚᩚᩚᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ𒀱ᩚᩚᩚ洲幸൲运5官方开奖结果体彩网:Department of Veterans Affairs (VA) loans are designed to help military members and vet♛erans afford a home. These loans are available with no down payment, no private mortgage insurance, and usually offer a competitive interest rate.

VA loans are only available through VA-approved lenders, who must comply with additional requirements, including complex underwriting rules. A buyer must also provide a VA loan certificate of eligibility (COE), which can sometimes take extra time. As a result, VA loans typically take 40-50 days to close. According to the latest data from ICE Mortgage Technology, VA loans closed in an average of 53 days in Aug. 2021, down from 61 days in Jan. 2021.

USDA Home Loans

The 澳洲幸运5官方开奖结果体彩网:U.S. Department of Agriculture also has a 澳洲幸运5官方开奖结果体彩网:home loan program for low- and very-low-income residents of rural areas who don't qualify for conventional mortgages and don't have safe housing. Thes⭕e loans also have more complicated underwriting processes, which m꧙ay extend the time to closing.

According to New York State's single-family direct home loan program under USDA auspices, "Processing times vary depending on funding availability and program demand in the area in which an applicant is interested in buying and completeness of the application package." Typically, you can expect the closing process on a USDA home loan to be an average of 32 days.

Steps of the Closing Process

Once your offer is accepted, there are still several 澳洲幸运5官方开奖结果体彩网:steps to your closing process. You can save a lot of time during closing by choosing your lender, your 澳洲幸运5官方开奖结果体彩网:loan type, and your home inspector in advance. You also will want to get 澳洲幸运5官方开奖结果体彩网:pre-approved with your preferred lender and have all of your documents in order before you ever go under contract. Note that some of the following steps can be completed out of order depending on your lender.

1. Schedule your home inspection right away. Depending on your area, home inspectors may be in high demand and scheduling several weeks out. 
2. Authorize a 澳洲幸运5官方开奖结果体彩网:hard credit pull with your lender.
3. 澳洲幸运5官方开奖结果体彩网:Lock your rate. Determining 澳洲幸运5官方开奖结果体彩网:when to lock your mortgage rate can be difficult, but deciding quickly can help maximize the chances that your loan will close on time. 
4. Have your lender schedule your appraisal right away. Appraisers are frequently booked several weeks out.
5. Provide documentation to your lender. Your personal situation will determine this, but you should be prepared to submit bank statements, pay stubs, two years of tax returns, a photo ID, and your Social Security card at minimum.
6. Complete the home inspection. Negotiate any issues that are found with the seller to your and your lender's satisfaction.
7. Complete the 澳洲幸运5官方开奖结果体彩网:appraisal. If the appraised amount is different from the sale amount, you’ll have to cover the difference, secure alternate financing, or negotiate with the seller to lower the sale price. 
8. Respond to any of your lender’s questions or requests for additional information as quickly as possible. 
9. Receive and review your closing disclosure. By law, your lender is required to give you a closing disclosure at least three business days before you close.
10. Close on your new home!
    

Closing Guarantees

A number of lenders, including Chase, NBKC Bank, SoFI, and others, have started offering a closing guarantee. The terms of each offer vary, but most agree to pay you a set amount if they can't close your loan on time. Chase's guarantee is $5,000 for a new home or investment property. NBKC Bank offers a $5,000 guarantee that is divided equally between the buyer and seller. SoFi offers up to $10,000 for a closing guarantee. Other lenders' offers are not as generous: New American Funding's guarantee, for example, is a $250 credit toward closing costs if closing doesn't happen within 14 business days.

Be sure to read the fin💦e print. Delays attributable to the borrower, seller, a third party, weather even🌳ts, or natural disasters are common exclusions.

The Bottom Line

How long your mortgage takes to close depends on the type of loan you choose, the scheduling timelines of appraisers and home inspectors in your area, and the complexities of underwriting, among other factors. Respond to all your lender’s requests as quickly and accurately as possible to keep things moving. And make sure that you don’t make any drastic changes to your financial situation wh𝓰ile you’re waiting. Congratulations, homeowner!