How long does it take to buy a home?

What the federal rules fix

Regulation Z, the rule behind the CFPB’s mortgage forms, sets these deadlines for most home purchase loans:

The word “business day” has a special meaning here. For these deadlines it counts every calendar day except Sundays and the legal public holidays in 5 U.S.C. 6103(a) (12 CFR 1026.2(a)(6)). Saturdays count. A holiday week therefore stretches the clock.

An “application” is not the full paperwork. It is six items: your name, your income, your Social Security number, the property address, an estimate of the property value and the loan amount you want (12 CFR 1026.2(a)(3)(ii)). Once the lender has them, the three-day clock starts.

Counting the minimum: an example

This is a calendar calculation from the rule, not a prediction. Suppose you receive your Closing Disclosure on a Friday. Counting back from a Tuesday closing, the three business days before it are Monday, Saturday and Friday, because Sunday is skipped. So Tuesday is the earliest closing date. If you receive it on a Thursday, the earliest closing is Monday. A federal holiday in the window pushes the date out by another day.

What can reset or delay the clock

Corrected disclosures normally need only reach you at or before closing. But a new three-business-day wait applies if any of three things changes after you receive the Closing Disclosure (12 CFR 1026.19(f)(2)):

• the annual percentage rate (APR) becomes inaccurate,
• the loan product changes, or
• a prepayment penalty is added.

Other delays come from the file itself. The CFPB notes that a different loan type or down payment, an appraisal result, new debt or income the lender cannot document can let the lender change your costs, and that late documents can delay closing. If your purchase contract has a deadline, you could lose the home and your deposit (CFPB).

Rate locks and deadlines

A rate lock keeps your interest rate fixed until closing if you close in the set time frame and your application does not change. The CFPB says locks are typically available for 30, 45 or 60 days, and sometimes longer, and that a lock may be expensive to extend. Ask your lender what happens if your closing is delayed and the lock expires. Choose a lock that matches the closing date written in your contract.

The CFPB also warns that once a seller accepts your offer, you may have as little as a couple of days to line up financing. Having a preapproval and your documents ready shortens that stretch. See mortgage preapproval.

Who controls each date

The CFPB tells you to check the top of page 1 of your Loan Estimate to see whether your rate is locked and for how long. Put that date next to the closing date in your calendar. See also mortgage rates explained.

Where states differ

States and contracts set the other timelines: how many days you have for inspection, how long the seller has to respond, when the earnest money becomes non-refundable, and whether an attorney reviews the contract first. Read the dates in your own sales contract. For state examples, see closing costs in Texas and closing costs in California. The sequence itself is in steps to buy a home, and the deposit rules are in earnest money.