Breaking Down the Home Buying Process from Start To Finish

The process of buying a home can be incredibly intimidating–especially if you’ve never done it before. There are mortgages, real estate agents, a home inspection, and a whole list of terms that you probably aren’t familiar with. Before you begin the heavy process of buying your first house, let’s walk through the entire process from deciding you want to buy to closing on your brand new home.

Preparation Needed

Most people think the first step of buying a home is talking to a realtor, but there are several things you should do before walking into that meeting to make sure it goes as smoothly as possible. Make a list of your absolute must-haves for your new home, and a list of things that would be nice but aren’t dealbreakers. This will help your real estate agent narrow down what houses to show you.

The most important thing for you to do, however, is set a budget. This involves establishing how much you can afford for a down payment and getting pre-approved for a mortgage from your preferred lender. There is a difference between getting pre-qualified and pre-approved for a mortgage, and getting pre-approved will make your home-buying process go quicker. Owning a home is a large expense, and you want to make sure you can actually afford it.

Find a Real Estate Agent

The next step is to find a real estate agent. Now, you don’t necessarily need a real estate agent to buy a house. Anyone can go online, find a listed home, and make an offer on their own. The key difference is that the real estate agent is familiar with the long process of buying a home and is your advocate throughout all of it. The seller’s real estate agent gets paid a percentage of the sale of the house, so they have an incentive to keep the price higher and with favorable terms for their clients. Even if the agent is ethical and a decent individual, it’s still a good idea to have a skilled real estate agent on your side.

Choose Your Dream Home

Now it’s time to look for your new home! Your real estate agent will take everything you’ve given them–your budget, your must-haves, your wants–and create a list of houses that are on the market that you might like. They’ll set up showings (or tours) for you to see the houses in-person to help you make your decision. Take time on these tours because it’s a big decision to make. You don’t want to make it rashly. If you’re torn between two homes, go see them again at a different time of day. You might discover the home that was perfect during the morning actually has an odd glare coming through the windows in the evening.

Make an Offer

Making an offer on a home is a bit more complicated than simply offering the list price. The home-buying process almost always involves some sort of negotiation, so you don’t want to show your cards before the discussion even begins. Your agent will be instrumental in helping decide how much to offer at the start.

The sellers will come back with a counteroffer, and your agent will work with you to reach a result that you’re happy with. Make sure to keep in mind your original budget and the mortgage that you’ve already gotten pre-approved for. It’s easy to fall in love with the home and end up spending more than you can afford on your new home.

Get a Home Inspection

Before closing on the deal your real estate agent has negotiated, it’s important that you get the home professionally inspected before you sign on the dotted line. While the buyer may have had the house inspected before it was listed, it’s important that you get someone of your own in to look for anything that may cause problems later down the line. A house is a big purchase, and you don’t want to go into this without knowing everything. A good home inspector costs anywhere between $200-400 on average, but they are money well spent.

Close on the House!

When everything is all said and done, the last thing you need to do is sign on the dotted line! Make sure all your funds are in order (mortgage, closing costs, etc.), and make sure you set aside enough time for the official closing. It takes longer than you think. Once everything is done and the property is officially yours, nothing is stopping you from enjoying your brand new home.