What's the Fastest Way to Buy a House?
If you want a space you can call your own or are interested in taking advantage of real estate as an investment, it's time to purchase a home. For some potential or first-time homeowners, the length of time it takes to purchase a house feels daunting.
Many wannabe homeowners spend at least a few weeks looking at prospective properties before deciding to put in an offer on a home. Then, they have to reach an agreement with the seller regarding the terms of the offer. Once a seller accepts an offer, it takes an average of 50 days to close on the new home. If you want to buy a house as quickly as possible, you have a few alternatives to speed up this process.
Buy the Home With Cash
The fastest way to buy a home is to pay all cash for the property. Assuming that everything works out logistically, it's possible to buy a home in a couple of weeks when paying cash. There are a few reasons why an all-cash transaction expedites the homebuying process.
One main reason that buying a home with cash is a speedier transaction is that it eliminates the need to apply for and take out a home loan. The process of securing approval for a loan takes a week or two. Once you have a contract in place, you have to wait a few weeks for the lender to gather and assemble all the documents and information needed to underwrite and fund the loan. If the lender is dealing with many homebuyers, this process can take even longer. An all-cash transaction eliminates these steps.
A cash offer is also attractive to sellers. They know that you won't have to worry about securing a mortgage. Financing issues are one reason why many real estate transactions fall through. If a seller has both a cash offer and an offer that's dependent on the buyer's ability to procure financing, the cash offer is usually more appealing.
Get Preapproved for a Home Loan Before You Start Shopping
Even though cash is king when you want to purchase a house quickly, most people don't have hundreds of thousands of dollars available to purchase a home outright. If you need to obtain a mortgage to buy your new home, you can expedite the process by getting preapproved for a home loan before you start touring properties.
When you secure mortgage preapproval, you provide the bank with all the information and documents needed to approve the loan and determine how much you can borrow. Some of the documentation you'll need to provide includes proof of income, bank statements and access to your credit history.
Once your lender preapproves you for a mortgage, you'll receive a letter that states the amount you're preapproved for. This document demonstrates that you have the means necessary to purchase the home. When you find a home you want to buy, your lender will already have the information and documents needed to move forward with the loan.
Note that getting preapproved for a mortgage isn't the same as prequalifying for a mortgage. The process to prequalify for a loan is less stringent and doesn't take into account all the information required to get approved for a mortgage.
Work With a Real Estate Agent to Find a Home
Regardless of whether you plan to pay cash for your home or need to take out a mortgage, a real estate agent can help you find a home you love as quickly as possible. Your real estate agent will ask you what criteria you desire in a home, taking into account your ideal size, preferred location and must-have features.
They'll find properties that meet your needs and set up times for you to view the homes that you're interested in. When you find a property you love, your real estate agent will assist you with preparing an offer for the home and negotiating the details of the deal with the seller. They can expedite the offer process and any subsequent negotiations by providing guidance as to whether the seller is likely to accept your deal. For example, if you're purchasing a home in a market with limited inventory, your real estate agent will likely encourage you to come in strong with your first offer.
A real estate agent will continue to be a valuable resource even after you're under contract on a house. They can assist you with scheduling home inspections and an appraisal. Your real estate agent will also try to handle any issues that arise that may delay your closing date.
Sell Your Home Before You Start Shopping for a New Home
If you currently own a home, sell your current house before you start searching for a new home. Otherwise, you run the risk of your old home slowing down the purchase of your new house. For example, you might decide to include a contingency that states your offer is dependent on your ability to sell your existing home. While this contingency gives you financial protection, it slows down the homebuying process. Some sellers may skip over offers with this type of contingency, increasing the length of time it takes for you to go under contract with the purchase.