Understanding the Home Buying Process Start to Finish

There’s a lot that goes into the purchase of a home, so I wanted to make sure you fully understand the process from beginning to happy end! Here’s a quick and simple list that summarizes every step of the home-buying process.

1. Determine how much house you can afford. Before jumping into the home buying process, set realistic expectations. Figure out how much house you and your family can afford. A mortgage payment that’s no more than 25% of your take-home pay is an ideal price-point to shoot for. 

2. Save for a 10%-20% down payment and closing costs. It’s ideal to put a down payment on your home, although there are some opportunities for down payment assistance that you can discuss with your lender. Also, keep in mind that you will have closing costs that you should factor in as well.

3. Set your home and neighborhood goals. Spend some time writing down your favorite neighborhoods. Think about the key things you want most in a house so you can communicate those wants and needs to your real estate agent. 

4. Find an expert real estate agent. It’s a good idea to find a quality agent early in the process. Your agent is your personal advocate, working relentlessly to help you find the perfect home. It’s a good idea to establish a relationship with an agent early, and that person can recommend a quality lender to you.

5. Get preapproved for a mortgage loan. Before you start looking at houses, you should get a preapproval from a highly rated lender. Without a preapproval, you will have no way of knowing what house you qualify for. 

6. Work with your agent to discuss your wants and needs. This is when you’ll share your list of home and neighborhood goals. Let your agent know what you’re looking for in a neighborhood and a house so they can begin scheduling showings.

7. Go house hunting. Your agent will research potential homes for you to view, schedule showings, and invite you to come view them until you find the perfect home to place an offer.

8. Make an offer on a house. Once you find a house that you love, it’s time to make an offer. Trust your real estate agent to help you make a competitive offer that puts you under contract!

9. Pay the security deposit and begin the mortgage process. If your offer is accepted, you’ll need to give a kind of security deposit called earnest money. Next, you’ll let your lender know exactly how much money to process for your mortgage.

10. Get a home inspection and appraisal. The inspection will ensure that there are no underlying issues with the home you’re purchasing. The appraisal will ensure that you aren’t paying more than the house is worth. 

11. Be patient as your lender processes any remaining mortgage paperwork. There’s quite a bit of paperwork that goes into processing a mortgage for a home. Keep in mind that it takes around 44 days on average. 

12. Close on your house—Hurray! At this stage, you’ll review and sign any remaining documents and make final payments. Closing day is when you finally become a homeowner and get your keys!