Timeline for putting offer in

k267

I'm a lurker here, but hoping someone can help me understand this.

We're in the market to buy our first house. What is the timeline usually once we find a place we like? Does our loan need to be pre-approved (or approved?) before we put an offer in, or can that happen a few days after the offer? (the reason this matters is that we might ideally want to try to put an offer in this weekend on a place, but we won't be ready with the downpayment until about a week later.. some of the money we plan to use for our downpayment was a gift, and our bank requires that this money has been in our account for two months, which will be Friday).

I will talk to our real estate agent about this too, but just trying to go into that conversation with a little more knowledge!

Thanks

formerlyGDaisy09

Usually your realtor will want you to be pre-approved for a certain amount so they know what price-range to show you homes in.  You do not need to have an offer approved by the bank until you agree on an offer with the sellers. you must have the cash for your downpayment when you go into the bank to get approved for the loan. they can only work with what you have in your accounts when you meet with them.  we also had to show that we had a certain amount of cash somewhere to cover several mortgage payments (I believe it's 6) our retirement accounts were able to serve that purpose, it has to be monies that you would be able to access in an emergency (job loss etc. to continue to pay the loan)

k267

Gdaisy09 said:

Usually your realtor will want you to be pre-approved for a certain amount so they know what price-range to show you homes in.  You do not need to have an offer approved by the bank until you agree on an offer with the sellers. you must have the cash for your downpayment when you go into the bank to get approved for the loan. they can only work with what you have in your accounts when you meet with them.  we also had to show that we had a certain amount of cash somewhere to cover several mortgage payments (I believe it's 6) our retirement accounts were able to serve that purpose, it has to be monies that you would be able to access in an emergency (job loss etc. to continue to pay the loan)

Thanks very much! This is really helpful.

The bank pre-qualified us (if this is the right term? I am so new to all of this) up to a certain amount, so we know the range that we are working in, but they said we can't actually get official approval for that amount until the two month mark after we had received some of the money as a gift (that two month mark is the end of this week). 

But it sounds like we could still probably put an offer in a few days before that, then? How much time does the back and forth with a seller over offers usually last? I know this must vary but just trying to get ideas. I know the market here moves fast generally.

formerlyGDaisy09

I think it depends on how motivated the seller is.  We put an offer in on our house 2 days before Christmas 2011, and back and forth only took a day.  we went into the bank after Christmas to get approved for the loan. and closed on 2/17/12.

k267

Gdaisy09 said:

I think it depends on how motivated the seller is.  We put an offer in on our house 2 days before Christmas 2011, and back and forth only took a day.  we went into the bank after Christmas to get approved for the loan. and closed on 2/17/12.

Thanks. That is helpful to hear.

When does the home inspection usually fit into the timeline of making offers/getting approval etc?

formerlyGDaisy09

after you've been approved for the loan, approval is pending the inspection coming back with only minor findings, or things you were aware of anyways. The appraisal will also happen after you're approved for the loan, in that case the approval is dependant on the appraisal being at least as much as the loan value.

cbee817

k267 said:

Gdaisy09 said:

I think it depends on how motivated the seller is.  We put an offer in on our house 2 days before Christmas 2011, and back and forth only took a day.  we went into the bank after Christmas to get approved for the loan. and closed on 2/17/12.

Thanks. That is helpful to hear.

When does the home inspection usually fit into the timeline of making offers/getting approval etc?

After the seller accepts your offer, you have a few days to get a home inspection done. If there are issues or repairs that need to be made, you can negotiate then if you want. Or you can back out of the deal if there are issues that you just don't want to take on (even if the seller agreed to fix them).

k267

Gdaisy09 said:

after you've been approved for the loan, approval is pending the inspection coming back with only minor findings, or things you were aware of anyways. The appraisal will also happen after you're approved for the loan, in that case the approval is dependant on the appraisal being at least as much as the loan value.

Thanks!!

ToastieSimons

I think it depends on where you live.  When we bought our last house we had a pre qualification for a certain amount.  This was used the write the offer.  When it came to financing there was an area that said by x date or within x days of this contract becoming valid buyers will obtain financing from x bank etc.  

maple2

I'm going to second the comment that this really depends on your area.  If you are in a place that is a sellers' market, not being pre-approved could hurt your chances of getting your offer accepted.  Basically, if the seller gets more than one offer and one comes from people who are pre-approved which the other does not, the seller might feel more comfortable with the one from people who are pre-approved.  If it's not a sellers' market, sellers are more likely to be more open minded about pre-approval.

strickland8052

I think it depends on whether you live in a buyer's or seller's market. We were definitely in a seller's market. Houses were getting multiple offers, going above asking price, bidding wars...just madness. In that case you need to be pre-approved. If you are in a buyer's market, then you may not necessarily need to be pre-approved.