Key Takeaways
- Most home purchases move from accepted offer to closing in 30 to 60 days.
- Contingencies protect buyers — waiving them carries real financial risk.
- A professional home inspection is your clearest look at a property's true condition.
- Lender underwriting is often the longest single step; respond to requests quickly.
- Closing costs typically run 2–5% of the loan amount and are due on closing day.
- A final walkthrough, ideally 24 hours before closing, is your last chance to spot new issues.
Making and Negotiating an Offer
Once you've found a home you want to buy, your agent will help you draft a purchase offer — a formal written proposal that specifies price, earnest money deposit, contingencies, and a proposed closing date. Before drafting, review comparable sales (often called "comps") with your agent to anchor your offer in current market data rather than list price alone. Unfamiliar with market terminology? Our housing market terminology guide explains concepts like absorption rate and days on market in plain language.
The seller will respond in one of three ways: acceptance, rejection, or a counteroffer. Counteroffers are common and may address price, closing timeline, or which party pays specific closing costs. Each counteroffer resets the negotiation clock — there is no binding contract until both parties sign the same final terms.
Protect Your Earnest Money
Your earnest money deposit is refundable only if you exit the contract within an active contingency window. Track every contingency deadline on your calendar and communicate any concerns to your agent before a deadline passes. Missing a deadline — even by a day — can convert a refundable deposit into a non-refundable one.
Your earnest money deposit (typically 1–3% of the purchase price) signals good faith and is held in escrow. It is generally applied to your closing costs or down payment at settlement, but can be forfeited if you back out outside of your contingency windows.
Opening Escrow and the Purchase Agreement
When both parties sign the offer, you have an executed purchase agreement — a legally binding contract. At this point, escrow opens. A neutral third party (an escrow company or an attorney, depending on your state) holds funds and documents until all conditions are met.
Your agent or attorney will review the purchase agreement carefully before you sign. Key items include: the purchase price, earnest money amount, contingency deadlines, items included with the sale (appliances, fixtures), and the projected closing date. For a plain-language breakdown of terms you'll encounter throughout this process, see our homebuying terms reference.
30–60 days
Typical offer-to-close timeline
Industry data from the National Association of Realtors consistently places the average contract-to-close period in this range for conventional purchases.
2–5%
Closing costs as share of loan amount
The Consumer Financial Protection Bureau estimates buyers typically pay 2–5% of the loan amount in closing costs, covering lender fees, title, and prepaid expenses.
81%
Buyers who used a real estate agent
According to the National Association of Realtors' Profile of Home Buyers and Sellers, the vast majority of recent buyers worked with a licensed agent during their purchase.
Home Inspection and Due Diligence
Within days of an accepted offer, you should schedule a home inspection by a licensed inspector. The inspector examines the structure, roof, foundation, HVAC systems, plumbing, and electrical — typically producing a detailed report within 24–48 hours. This is not a pass/fail test; it's an information-gathering tool.
Based on the inspection report, you can: proceed as-is, request repairs or a price reduction, or — if the inspection contingency is in place — withdraw without penalty. Specialty inspections (radon, sewer scope, mold) may be warranted depending on the property and region.
Order a sewer scope inspection separately from the general home inspection, especially on homes built before 1980. Root intrusion and aging clay pipes are rarely visible to the eye but can cost thousands to repair after closing.
Sewer line issues are among the most expensive post-purchase surprises and are not covered by a standard general inspection, making this add-on one of the highest-value checks a buyer can perform.
Do not interpret a "clear to close" from your lender as the finish line. Continue to avoid new credit inquiries, large deposits, or job changes until the deed is recorded — lenders sometimes re-verify credit the day before closing.
Last-minute underwriting re-checks are increasingly common; any financial change discovered at this stage can delay or derail a closing that appeared complete.
Due diligence also includes reviewing the seller's disclosure statement, HOA documents if applicable, and any title search findings. Each has its own deadline specified in the purchase agreement.
Appraisal and Mortgage Underwriting
If you are financing the purchase, your lender will order a home appraisal — an independent estimate of the property's fair market value. Lenders will not loan more than the appraised value, so a low appraisal can require renegotiation, a larger down payment, or, if the appraisal contingency is active, cancellation of the contract.
Simultaneously, your loan file moves into underwriting, where the lender verifies your income, assets, credit history, and the property details. Underwriters frequently issue a "conditional approval" requiring additional documents — pay stubs, bank statements, letters of explanation. Respond to these requests as quickly as possible; delays here are the most common reason closing dates slip.
Avoid making large purchases, changing jobs, or opening new credit accounts during this period, as any of these can jeopardize your loan approval.
Clearing Contingencies and Preparing to Close
A contingency is a condition that must be satisfied for the sale to proceed. Common contingencies include financing, appraisal, and inspection. Each has a deadline; once you actively remove or waive a contingency in writing, your earnest money is generally at risk if you back out for that reason.
As contingencies clear, your escrow officer will prepare a Closing Disclosure — a standardized document your lender must provide at least three business days before closing. Review it carefully and compare it to your Loan Estimate to verify that fees, interest rate, and loan terms are consistent.
Arrange your closing funds (typically via wire transfer) and confirm the amount with your escrow officer. Do your final walkthrough and document prep within 24 hours of closing to verify the home's condition is unchanged and agreed repairs were completed.
Closing Day: What to Expect
Closing — also called settlement — is the final transfer of ownership. You'll sign a large stack of documents: the promissory note, deed of trust or mortgage, and various lender disclosures. In many states, buyers and sellers sign separately. The process typically takes one to two hours.
Once documents are signed and funds are confirmed, the deed is recorded with the county, and ownership officially transfers. You receive the keys. From that moment, you are the legal owner of the property.
If you're still in the early stages of your homebuying journey, our first-time buyer guide covers the groundwork — credit, budgeting, and timeline — before you ever make an offer.
This article is for general informational purposes only and does not constitute legal, financial, or real estate advice. Processes, timelines, and requirements vary by state and individual circumstance. Consult a licensed real estate professional, attorney, or financial adviser for guidance specific to your situation.