Buying a home (whether it’s your first home, you’re moving up, or you’re downsizing) can be an exciting yet complex experience. No matter how many times you’ve gone through the process, it’s handy to refresh your memory regarding the steps and best practices involved. 

Hiring an experienced agent can help guide you through the process fairly seamlessly, but it’s always best to be prepared. From figuring out your budget and down payment options, to choosing the perfect neighborhood, the home buying experience can be fun as long as you have a game plan. Follow these steps for an ideal home buying experience.


How much house can you afford?

This is a crucial first step in figuring out your housing situation. After all, you wouldn’t want to set your heart on a certain neighborhood that was out of your price range, would you? Alternatively, you’ll want to search for the home that best fits your needs, so knowing your budget is a great starting point.

-       Calculate monthly income and debt. How much money is coming in vs. going out each month? Can you comfortably afford to spend more on housing? How much more?

-       Check your credit score. You will need to have a decent credit score to get a mortgage loan. The lower your score, the higher your interest rate will be. You will probably want to have a score of 650 or higher.

-       Choose a lender, get pre-approved. Getting pre-approved by a mortgage lender lets you know exactly how much you can spend on a home. Having a pre-approval also makes you more attractive to sellers in a multiple offer situation.

-       Down Payment. A 20% down payment is standard for the purchase of most homes, but there are also programs like FHA, VA, and USDA that allow for a much lower down payment.


What do you want/need in a home? 

-       Choose a general location. Do you want to live in the city? Would you prefer to live in the suburbs? What about the country? Choosing the general area will help you narrow down your options.

-       Determine the size of home you need. The size of home you’re looking for will help you decide the area, style, and price of your target range.

-       Determine your price range. You should already know how much you CAN afford, but determine how much you’re willing to spend to further narrow down a target price.

-       Choose your optimal style of home. Are you looking for a mid-century modern fixer upper, a new build, or a condo? What about a roomy ranch style or a bungalow? Helping decide exactly what you’re looking for before you go out on the hunt will save everyone a lot of time.


What neighborhood do you want to live in? 

-       Research schools. If you have or plan to have children, researching where the best schools are can help you determine your ideal neighborhood.

-       Calculate traffic/commute times. See how far each potential area is from your work, gym, or the places you visit the most. Avoid a lengthy commute, and you’ll be glad you did!

-       Explore neighborhood amenities. Do you want your neighborhood to have a dog park or walking trail? What about a community pool and gym? These perks can add incentive to live in one neighborhood over another. Choose which are most important to you!


Choose a qualified agent.

-       Interview at least three. This step is very important. Interview several agents to determine who is most qualified to guide you in your purchase. You’ll be spending a decent amount of time with them, so make sure you get along with them as well!

-       Experienced, well-connected, trustworthy. These three traits are great ones to look out for.

-       Sign a buyer’s agreement. Once you find the chosen one, you’ll need to sign a buyer’s agreement to seal the deal. This helps protect both sides legally, in case anything should go awry.


Search for homes… the fun part! 

-       Browse listings online. Use a home search website like to browse for homes in your favorite neighborhoods. You can usually find homes you like and show them to your agent, giving them a better idea of what it is you’re looking for. They can then help you find homes that are not on the market yet, or that you might have missed. They can also reach out to their connections in the industry to find you extra options.

-       Tour homes with an agent. This is the part that most people think of when they imagine buying a home. You’ll go to the different houses you’ve picked out to see them in person. You’ll likely attend an open house or two while you’re refining your wish list.

-       If you love a house, don’t wait. A word of caution – in a market as hot as ours, you should not hesitate too long if you find your dream home. Homes in the most desirable neighborhoods are being sold in the first few days, many times with multiple offers. Come in quickly, with a strong offer if you’re in love with a house.


Submit offers and negotiate.

-       Submit a solid offer. As we said before if you’re in love with a house come in with an offer above asking price. Since you’re already pre-qualified (right?), the buyer will know that you can back up your offer. Sometimes writing a letter to the seller that lets them know how much you want the home can tip the scales in your favor. Your agent should pull out all the stops for that perfect place.

-       If the offer is accepted, give earnest money and enter the option period. Earnest money lets the seller know you’re serious. It’s usually a deposit from $500 up to 3% of the sales price, and it’s credited back to you at the time of closing. You can back out during your option period, but if for some reason you terminate the contract after, the seller will keep the earnest money.

-       Both parties agree to terms. Once both parties agree, you can begin to plan for closing. Your agent should act as a liaison during this time and guide you through the process.

-       Set closing date/move in date. It usually takes about a month to finish all the paperwork and close on a house. Figure out when this will be and try to prepare for move in!


Finalize the deal.

-       Set up an appraisal. An appraiser will ensure that the house you’re about to buy is worth the money the lender is about to shell out. You want it to be appraised for at least the amount you’re buying it for, or you might run into problems.

-       Set up an inspection. It may be tempting to skip out on an inspection, but this step is crucial! Some defects can’t be seen with the untrained eye, and an appraiser can point them out. You’ll want to know ASAP if there is a shoddy foundation or the roof needs repair so that you can factor it into your final negotiations.

-       Re-negotiate if necessary. If they do find problems, you can negotiate to have them fixed or adjust the price. In rare instances, you may want to re-evaluate the deal.

-       Choose home insurance company. Compare rates and choose the best homeowners insurance. You will want to be protected if anything happens to your new investment!

-       Complete the loan and title work. The loan and title companies will walk you through any paperwork you need to submit. Most times you’ll need to provide back taxes, proof of income, proof of identity and more.

-       Final walk-through. You can participate in one last walk-through of the house to ensure everything is the same as when you started negotiations.

-       Get your money in order for down payment. Get your down payment and closing costs in order and ready for the big day. They will usually only accept a check or money order. Bring this to the closing table along with any other documentation specified by your Realtor®.


Close and move in!

And, you’re done! Your real estate agent should come with you to closing, where you will sign some papers and usually get your keys. At this point, you should feel pretty accomplished. Enjoy moving into your new home!