How long will it take to get a home loan in 2023?
Once you have found the home of your dreams, the estimate or the simulation of your loan finished, two questions emerge:
- How long will it take to get a mortgage in 2023?
- How long does it take from the time I put together a financing package to the time I sign the loan?
Do a market study on several banking institutions, gather the necessary elements to build your file… all these steps can be long.
In this article, discover concrete answers and our tips to speed up the process with a lending institution. Put all the chances on your side so that your purchase offer leads to the handing over of your keys.
How long does it take to build a mortgage loan file?
You have fallen in love with a property and would like to make an offer to purchase apartment collioure . If this is accepted, you will have to sign a promise to sell 1. In this unilateral promise of sale, a suspensive clause is generally provided. This allows you to give up the purchase if you do not obtain a mortgage to finance it.
Therefore, a minimum period of time must be allowed for you to conclude a financing contract with a bank. The legal period to obtain a real estate loan is a minimum of 30 days. However, given the increasing number of files to be processed by financial organizations, this period can extend from 45 to 60 days.
If the deadline for subscribing to the mortgage proves to be too short, you can request an extension of your conditions precedent by an amendment to be signed by the seller.
Otherwise, if your loan application is refused, the promise to sell is cancelled.
Good to know: promise to sell and real estate loan financing
When the unilateral promise to sell provides for financing from a mortgage, the buyer is forced to request this loan. If not, he will have to pay the agreed price of the sale 2 .
What are the steps to obtain your mortgage and sign the deed of sale?
In fact, multiple phases are linked between the promise - or the sales agreement - and the signing of the final deed. Here's what you need to consider:
- Compliance with the purchaser's withdrawal period;
- Verification of the right of first refusal by the notary;
- Deadline for funding agreement.
This period is generally spread over a minimum of 3 months.
How long does it take for the bank to approve?
The conditions for obtaining a mortgage
Regarding the steps for obtaining a mortgage , you will have to start by building your file. You will therefore have to provide your bank with all the essential elements for taking out a loan, such as your income, your contribution, your professional situation, your sales agreement, etc.
Then comes the agreement in principle. This document contains all the conditions of the real estate loan offer:
- Duration of the loan;
- Sum of monthly payments;
- Interest rate ;
- Date of the first payment.
Your adviser will take the opportunity to fix the additional costs, such as the guarantee and the borrower's insurance.
Steps after submitting the mortgage application
The agreement in principle only represents a favorable opinion concluded “subject to use”. The lending institution must still analyze the risks and may refuse financing.
You can, however, make a copy of this agreement to send it to your real estate agent and your notary. It will prove your efforts to obtain the loan. Putting together your file for a real estate loan may take you between 3 to 5 weeks.
How long does it take for the bank to release the necessary funds?
Once the file is validated, you will obtain an official loan offer for which you will have a 10-day cooling-off period.
Then, before the expiry date of the offer, and from the 11th day, you will have to sign its acceptance. The lender then has 7 days to let you know whether or not the credit is granted.
Once the contract is signed, your version will be sent to you by post or certified email. A copy should be sent to the notary, as its receipt, dated and signed, formalizes the release of the funds, which takes place from the 8th day after the acceptance of the credit.
Tips that will save you time getting financing
Know the market offers
Completing a financing file on time can become a real challenge depending on the circumstances. The most prudent therefore remains anticipation. Save time upstream of a possible promise to purchase.
For example, when you plan to buy an apartment in Collioure, nothing prevents you from making an appointment with several lending establishments to carry out a simulation.
You can take the opportunity to compare rates, proposals and you can predict which institution would be most likely to grant you a loan.
To speed up your research, the services of a broker will be of great help to you in looking for the best loan offers.
Consider your personal situation
It is important to estimate your debt capacity, which is regulated in France 3. Thus, you will target goods within your reach from the start.
In addition, your steps will be much faster if you present a complete file from the start. So prepare, in advance, all the elements that can be used to set up the financing (latest tax notices, latest pay slips, latest account statements, proof of address, etc.).
Keep in mind that although it is possible to extend the suspension clause period by sending a request for extension to the seller, you will need their agreement. Nothing obliges him to accept, if he is in a hurry, he can very well stop everything and choose to deal with another buyer.
To conclude, here are the things to remember about the time it takes to get a home loan in 2023:
- You have a minimum legal period of 30 days to obtain your loan after signing the promise to sell;
- It usually takes more than 3 months between the signing of the promise to sell and the final deed of purchase at the notary's office;
- To save time on obtaining a mortgage, you can consult the lending institutions as soon as you plan to buy real estate.