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10 Steps To Buying A House

Updated: May 2

In this article, we’ll introduce and walk you through each of the key steps to buying a house and walk you through them, so you’ll know exactly what you’re getting into and how to prepare.

Steps To Buying A House

Buying a house is an important milestone, but for first-time home buyers who don’t know what to expect, the process is often as intimidating as it is exciting. In these uncertain times of high list prices and rising rates, the decision to buy a house may feel even more overwhelming than ever, but we’re here to help.

What Do You Need To Buy A House?

Before you start looking for the perfect home, ask yourself if you’re even ready to own a home, financially and emotionally. If you feel you are, next ensure you have what is needed to buy a house. In order to purchase a home, you should have:

  • A strong credit score.

  • Money saved for a down payment and closing costs.

  • Preapproval for a mortgage loan.

  • A qualified real estate agent.

Once you’ve drafted up your home buying checklist, started the home buying process and found a property you love, you’re also going to want to make sure you have:

  • All the necessary documentation.

  • A clear, comprehensive understanding of what goes into purchasing a house.

The process typically involves finding a real estate agent, touring houses and getting a loan, but you might be less clear on where to go, who to talk to or in what order you should be doing these steps. To make everything clearer, let’s go through the home buying process and the order in which you should complete the steps.

How To Buy A House In 10 Steps

A family photo after buying a house
  1. Check Your Credit Score

  2. Determine How Much You Can Afford

  3. Choose A Lender And Get Preapproved For A Mortgage

  4. Hire Michael Forkas

  5. Start The Home Search Process

  6. Make An Offer

  7. Get A Home Inspection And Home Appraisal

  8. Purchase Homeowners Insurance

  9. Do A Final Walkthrough

  10. Close On Your New Home

There’s a lot of crucial transferring of information that takes place during a real estate transaction, and you’ll want to be certain you know enough to be able to advocate for your needs each step of the way. The best way to prepare is to know exactly what to expect. Here are the steps you’ll need to accomplish before you can receive the keys to your new home:

1. Check Your Credit Score

Before you begin the home buying process, you want to make sure you’re actually in a position to take on all that buying a house entails. That’s why the first step is to check your credit score and review your finances.

How Your Credit Score Affects Buying A House

Securing financing isn’t always easy. Mortgage lenders will request a credit report and, based on the information found, will use your credit score and financial history to qualify you for a home loan. It’s important to be one step ahead of them and know where you stand.

Your credit and financial history will dictate whether you’re able to obtain a mortgage and at what interest rate. Buyers with higher credit scores tend to secure better mortgage rates and loan terms, so make sure you understand your credit before getting deeper into the process.

2. Determine How Much You Can Afford

Before you speak with a mortgage lender, it’s helpful to calculate how much house you can afford on your own. A lender will tell you how much money you qualify for, but you want to ensure you won’t overextend yourself.

Typically, experts recommend spending no more than 31% – 36% of your gross monthly income on housing costs. These costs include:

  • Principal: This is the money you borrowed to purchase your home.

  • Interest: This is the fee the lender charges you to borrow the funds.

  • Taxes: You’re required to pay property taxes to the government based on the value and location of your home.

  • Insurance: Homeowners insurance protects your home against any damages. You can add liability coverage and protection for personal belongings within the home.

  • Association dues: These are fees you must pay if your home belongs to a homeowners association. If your home is not a part of a homeowners association, you won’t have to pay this fee.

Calculating Your Home Affordability

To calculate how much home you can afford, consider using the home affordability calculator below. Once you’ve determined how much you can afford, consider the lifestyle you want to maintain and leave yourself a cushion in case of emergencies. Don’t forget about factors like retirement, college funds and family vacations as you do your budget planning.

3. Choose A Lender and Get Preapproved For A Mortgage

The next step is finding a mortgage lender and getting preapproved for a mortgage loan. You can – and should – shop around different lenders to ensure you’re paired with the right one for your situation. Doing your research can make a big difference.

Getting Different Loan Estimates

There are often variations in qualification guidelines, interest rates and closing costs between lenders, which is why it’s essential to do your homework. When comparing lenders, ask each one to provide you with a Loan Estimate, which will spell out the loan terms, projected payments and closing costs for your potential mortgage. This form is provided in a universal format, making it simple for you to compare lenders.

Be sure to consider factors beyond the bottom line, too. A lender might be offering a great deal, but it may or may not be worth it if it comes with lower-quality customer service. Buying a house is a long and often complicated journey, so it’s essential to find a lender you can trust to make the process as simple and convenient as possible.

Getting Preapproved

Contrary to popular belief, getting prequalified for a loan doesn’t guarantee that you’ll be able to obtain a loan. Moreover, not all qualifications are equal. When you get prequalified in the traditional sense, lenders only estimate your finances based on the information you provide.

4. Find A Real Estate Agent

While some home buyers might decide they want to buy on their own, having a trustworthy and reliable real estate agent can make things a lot simpler.

Your real estate agent will represent you throughout the home buying process to ensure you find the right home, ask the important questions, make an appropriate offer, have the power to negotiate and receive the necessary disclosures. Perhaps even more important is having a real estate expert in your corner can provide some invaluable peace of mind.

The way to find the right real estate agent is by asking the right questions. Some questions to ask include:

  • How long have you been working as a real estate agent?

  • What makes you different from other agents?

  • How many clients are you currently working with?

  • What experience do you have finding homes in my price range?

  • How knowledgeable are you about my desired area?

  • Are you willing to provide me with references?

Once you select the best agent for you, they’ll look over your approval letter, discuss your budget and help you set your priorities.

5. Start The Home Search Process

Once you’ve met with your real estate agent to discuss what you’re looking for, it’s time to begin house hunting. As you browse, keep your priorities in mind. It’s highly unlikely any listing will perfectly match your dream home, so try not to be too picky until you see the houses in person.

Finding The Right House

The first step to finding the right house is knowing what you’re looking for. Make a list of your wants and needs, and rate them in order of importance.

To make your search easier, start out by looking for homes online. By checking out online listings, you can get a feel for what’s on the market and prescreen any homes within your price range, so you’ll only tour places you’re truly considering.

If you’re having trouble finding a house that feels like home, consult your real estate agent. Agents aren’t just experts on helping people find a home; they’re also experts on the local housing market. They can help you set realistic expectations and keep you motivated when you’re feeling like you’ll never find the right house.

6. Make An Offer

When you find a home you want to buy, it’s time to begin the process of making an offer. Ask your real estate agent to run a comparative market analysis to determine a fair price based on recent sales of similar homes in the area. The longer a house has been on the market, the more power you may have to negotiate.

Beyond the price you plan to offer, you should speak to your real estate agent about whether it makes sense to include any contingencies in your offer. A contingency is a stipulation included in an offer that states that the buyer is free to break the contract without any repercussions if a particular condition is not met.

Although sellers sometimes balk at offers made with contingencies, some contingencies are worth making regardless of the seller’s feelings about them.

7. Get A Home Inspection And Home Appraisal

You may think you’ve reached the finish line when your offer is accepted, but a few critical steps remain. From here, you’ll want to arrange for a home inspection and appraisal.

Home Inspection

The home inspection is important, as it will identify areas where major repairs or renovations require immediate attention as well as any work that needs to be completed in the future. Be sure to hire a professional, third-party home inspector to examine the home you’re preparing to buy.

Home Appraisal

At this point in the process, your lender will require the home to be appraised before they agree to release any funds. A home appraisal estimates how much a home is actually worth based on comparable sales in the area, market trends, public records and a comprehensive inspection of the property.

8. Purchase Homeowners Insurance

Also in your best interest is homeowners insurance, which works as a safety net to protect your home and finances. Although homeowners insurance isn’t legally mandated, most lenders will require you to have an insurance policy on the home before giving you a loan.

Homeowners insurance covers damage to your home and its surrounding structures as well as stolen or damaged personal property. There are varying levels of coverage, ranging from basic to comprehensive, so be sure to do some research into all available options before deciding which home insurance product is right for you.

9. Do A Final Walkthrough

At this point in the home buying process, you’re probably eager to be done – but don’t neglect the final walkthrough. One last walkthrough of the property can help the buyer if something needs to be fixed by the seller before purchasing the home.

Final walkthroughs typically take place a day or two before closing, allowing you to ensure all agreed-upon repairs have been completed.

10. Close On Your New Home 

The final step to buying a house is, of course, closing on your new home. When that time comes, make sure you review your Closing Disclosure, which will outline the terms, final closing costs and any outstanding charges or fees included in your loan. Your lender will send the disclosure to you at least 3 business days before closing.

During closing, the property title will pass from the seller to you. A closing agent will oversee this process, which typically takes place at a title company, management firm, escrow office or your home.

The closing agent will ensure that all necessary parties are present at closing. The agent acts as a mediator between you and the seller and confirms that all required documents are signed. Once documents have been signed, the agent will ensure that all funds are paid and properly disbursed, including closing fees and escrow payments.

During closing, you have two primary responsibilities:

  • Signing legal documents: This includes the Closing Disclosure, promissory note, deed of trust or and certificate of occupancy.

  • Paying closing costs: This may include fees for your mortgage application, appraisal, survey and title search, and paying your down payment.

After all necessary documents are signed and information is exchanged, you’re ready to move into your new home.


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About Michael Forkas: Michael Forkas is not your typical real estate agent. After building a successful real estate development company, he pivoted his career to provide unmatched service to homeowners. Michael stands by his promise: "Your Home SOLD Guaranteed or I'll Buy it at a Price YOU Agree to!" He won't sell you a home he wouldn't buy himself, ensuring a trademarked approach that guarantees satisfaction and success.

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Content by Forkas Home Team Walnut Creek Realtors

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