Time is more important than ever—especially if you are trying to buy a home. Historically low inventory and high demand have resulted in intense competition for buyers in markets across the country. In addition to sheer competition, buyers also still need to think about financing, pre-qualification and closing costs to put them in the best shape for having an offer accepted.
As real estate professionals, this is not news to you. The closing process is one aspect of homebuying that is most successful when time is on your side. The last two years have offered new considerations for agents aiming to get their clients in their homes as quickly as possible and close on time—or early.
Let’s dive into how you can improve closing efficiency and your client’s chances of scoring a home with proper preparation and resources.
- Educate for efficiency
The homebuying process can take anywhere from four weeks to six months. A 2021 report found that it takes 51 days on average to close on a home. A couple extra weeks or even days could be the difference between your client scoring a home or the deal falling through in today’s competitive market.
It’s important that your client is educated and prepared for every step to ensure a smooth process before and during closing. Taking the time to educate your client on key terms and ratios, upfront costs, unique market trends and fair housing rules, can be a huge help in ensuring nothing comes as a surprise when it’s time to close.
There are resources available to help your clients—especially first-time homebuyers—boost their homebuying knowledge, such as whitepapers, webinars, and podcasts. The Beginner to Buyer podcast is one example. Every episode offers conversations with real buyers and expert guests about each step of the process, from mortgage application to closing.
- Get finances in order first
Buyers should have their finances in order before they begin their home search for a quick closing process once the offer has been accepted. Coming prepared with a mortgage pre-qualification, funds for a down payment and cash available for closing costs will help ensure they don’t lose out on the home at the final hour.
One of the main challenges for homebuyers is the upfront cash required for down payments and closing costs. These costs can amount to up to 3% or more of the final purchase price, which may come as a surprise to some buyers. Work closely with your network of advisors, loan officers and mortgage experts to help your client determine how much they can afford, what financing options are best and where assistance is available to help manage these upfront cash demands.
There are also loan options that require as little as 3% down for eligible homebuyers and many location-based and lender-backed homebuyer grant programs available to help with upfront costs, including Chase’s own Homebuyer Grant which can offer eligible customers up to $5,500. Down payment assistance programs like these can help to level the playing field.
- How lenders can help
Take advantage of lender-backed resources available to help your clients get into their homes on time. For example, Chase’s Closing Guarantee commits to closing customers on their new homes in as soon as 21 days or gives them $5,000 cash. The program offers buyers peace of mind knowing that they are guaranteed to close on their new home without delay or receive compensation that can be put towards additional costs.
It’s key to educate your client on the process, make sure they’re well-prepared for the financial commitment of a home purchase and help them take advantage of resources available to move through the homebuying process quickly. Agents who can help their clients find and close on a home on time will be rewarded with satisfied clients who are more likely to refer them to others.
Sean Grzebin is head of consumer originations for Chase Home Lending.