It’s finally here! Closing day. The “official” day when you buy or sell your home. And it should be pretty straightforward, right? After all, the bulk of the work has been done: price and terms finalized, inspections passed, mortgage approved. It seems like the only thing left is for you to sign a few papers and either hand over the keys (if you’re the seller) or take possession of the keys (if you’re the buyer).
Except it’s not quite that easy. Or that fast.
So how long does closing day take? Every step of the closing process has taken its time, and signing the final paperwork is no different. We’ll go over everything you need to know — including the closing day timeline.
Before you can even get to the closing table, there are numerous steps that must be followed and checklists that have to be completed. In fact, most real estate transactions take between 30 and 60 days to close, with 47 days being the average.
Every state, county, and lender is different, with unique procedures and schedules. The following is just an average timeline for closing on a house, to give you an idea of what needs to be done.
Once the buyer has made an offer, the seller can make a counter-offer. This may go back and forth a few times until a final agreement has been reached. During the contract negotiations, the closing date will be set.
Once the final offer is signed by the sellers, the buyer should schedule a home inspection as quickly as possible. The home inspection is not mandatory, but many lenders will require it. If any defects show up in the home inspection that need to be repaired, the contract may need to be renegotiated (depending on the contingency clauses).
Once the inspection is done, and the resolution of any defects has been agreed to, both the buyers and sellers will need to sign the final purchase agreement.
The buyer will finalize any paperwork necessary in the mortgage application process. This may include an online or virtual meeting with a loan officer.
Even if the buyer and/or seller have already had appraisals done, the mortgage company will need its own appraisal. They will use their appraisal to determine whether the home (collateral) is worth the amount of the loan. If the answer is yes, they will continue the loan approval process. Occasionally, but not very often, the lender will require additional documentation to make sure the home is being appraised properly and for the amount of the loan.
After the appraisal, the mortgage company will once again look over the buyer’s finances, to make sure nothing has changed. Once the lender has determined that everything is in order, the buyer will receive the final approval for the loan. This step is called “clear to close.” Now everyone can sit back and wait until closing day.
These are the major milestones, but some other steps need to take place too, such as ordering repairs for anything that came up during the inspection and the buyer obtaining homeowner’s insurance and title insurance.
Once the buyer has been cleared to close, the buyer and seller must choose a closing day and time. And there’s no way to deny it: closing takes time. Exactly how long does closing day take? In fact, closing can take anywhere from 5 minutes (very rarely) to several hours (much more common).
It will be very difficult to get your closing done during your lunch hour, so plan to take a morning or afternoon off of work, just in case. You don’t want to be rushed; you want to have time to look over documents for as long as you’d like before signing anything.
Also, try to avoid late afternoons, especially a Friday afternoon. You want to have time, in case anything goes wrong. The real estate transaction won’t be completed until the funds have been transferred. This can take anywhere from five minutes to two hours. If it is past wiring time or there is any kind of glitch, the funds might not be transferred until the next business day.
Save yourself any unnecessary stress by scheduling your closing earlier in the day.
Once closing day arrives, both the buyer and seller will go to the agreed-upon location, usually the title company’s office. In some states, the buyer and seller must be there at the same time. In other states, that is not required, especially since the seller has very few documents to sign.
Sellers have the easiest part of the process. On average, the seller is done within 5-20 minutes. Often, the seller will pre-sign their documents and have the proceeds from the sale transferred via wire, so they won’t even be present during closing.
Typically, the seller only has to sign a few documents, such as the deed and the closing statement. They must also hand over their keys, garage door opener, etc.
Buyers bear the brunt of the paperwork. Not only do they have to sign the deed and transfer, they must also sign all the paperwork from the lender. This is why it can take a buyer, on average, two hours to sign their closing documents.
Most buyers will have to sign the following:
Technology is taking over every aspect of modern life, and that includes closing on a home. What was once unthinkable is now almost common – for either the buyer or the seller to not be present at closing. This is particularly important to buyers, since they are often buying a home in another city or state and have not yet relocated.
Depending on local laws, either the buyer or the seller (or both) can make use of the Remote Online Notarization Act. Basically, this act gives the Power of Attorney to the Realtor acting on their behalf. Unlike a regular Power of Attorney, this one has strict limits and can only be used to complete this specific transaction.
Buyers and sellers both should take their time with the many closing documents. Read them thoroughly and request further explanation or clarification if there’s anything you don’t understand. Bring a copy of any other paperwork you have signed or received to compare and make sure that everything is stated as it should be. Lastly, make sure you leave with copies of everything you have signed.
Closing on your home can be a long day, but it shouldn’t be stressful. If you are working with the right Realtor, they will walk you through the process and make sure that everything goes smoothly.
If you haven’t found a real estate agent yet, you can find a top-notch agent through UpNest, which is owned by parent company Realtor.com. With our free service, you will receive competitive proposals from 3 to 5 of the best Realtors in your market. You can choose one and they will walk you through everything from the contract negotiations all the way up to closing day
Agents Compete, You Win. Can you sign closing documents before the closing date?There is no specific provision the specifically prohibits early signing of closing documents, but most lenders don’t allow for early signings. TRID (TILA RESPA Integrated Disclosure Rule) is a set of guidelines that dictates information that lenders need to provide to borrowers. TRID dictates that the Closing Disclosure is delivered three days before the “consummation,” which is based on state law. Early signing could violate this.
How long does signing closing documents take?The time to sign closing documents will vary based on the situation. Depending on how complex the transaction is, you could spend just under half an hour to several hours at closing.
Who signs closing documents first, the buyer or the seller?The seller will sign the closing documents first and in many cases will not need to present at the closing. A seller may be able to pre-sign the deed and many other transfer documents, while the buyer will usually need to sign almost everything in person for the lender at closing.
