Steps to Buying


While there are certainly more details involved, the following is an outline to help you understand the basic process of purchasing a home.

  1. Prepare by Managing Your Finances
  2. Maintain a good credit history (or make repairs if necessary)
    b. Minimize debt
    c. Save for a down payment: 3-20% of the cost of a home
    d. Get an idea of how much you can afford by understanding your debt-to-income ratio
  3. Research Mortgages
  4. Understand basic loan types
    b. Familiarize yourself with costs involved (points, origination fees, etc.)
  5. Find a Lender
  6. Work with someone you can trust
    b. Find out as much as possible about how your loan is priced
    c. Get the best deal you can
  7. Get Pre-Approved for Your Mortgage
  8. Pre-approval will provide you with a “budget”
    b. When you find your home, you will officially apply for the mortgage and receive a Good Faith Estimate (GFE) of the final closing costs
  9. Find a Realtor
  10. Speak with multiple candidates
    b. Interview clients from the recent past
    c. Work with someone you can trust
  11. Go Home Shopping
  12. Is it the home?
    b. Consider the commute, amenities, schools, etc.
  13. Make an Offer
  14. Your Realtor should help you determine what is reasonable
    b. Don’t be afraid to barter
  15. Get Insurance Prior to Closing, options include
  16. Title insurance,
    b. Homeowners insurance,
    c. Flood insurance, and
    d. Home warranties.
  17. Go to Closing
  18. Bring photo identification
    b. Be prepared to review and sign a lot of paperwork, including the HUD-1 Settlement Statement (essentially the official “receipt” of the transaction; may differ from GFE).

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