The 9 Steps to Buying a Home | Mortgage Number

If you’ve decided it’s time to purchase your first home, we bet you have hundreds of questions! It’s one of the most significant milestones in life and will likely be the biggest purchase you make. To help break this enormous task into manageable pieces, we’ll go over the 9 steps to buying a home. As you may have guessed, the first step starts with research!

Step 1: Research, Research, Research

Search through real estate listings, magazines, and websites (like Zillow) to do some preliminary research. Look around at homes in your area, get an idea of pricing, and see how long they stay on the market. You can keep an eye on listings to see if they change their asking prices over time. After a while, you’ll get a good sense of housing trends and know what to look out for. 

Step 2: Use Our Mortgage Number Calculator

Before getting preapproved, purchasing, or refinancing, you’ll want to visit our website and fill out our Mortgage Number Calculator. This incredibly valuable tool will show you what your strengths and weaknesses in the mortgage environment are, and will help you understand how financial institutions view you as a lender. Our free Mortgage Number Calculator allows you to skip the complex processes and time spent getting multiple quotes and gives you an immediate and clear understanding of the opportunities that are available for you in the mortgage space! Our calculator will show you the likelihood of getting approved for a loan, and how to improve potential weaknesses. Once everything looks good, and our calculator gives you the green light, it’s time to move on to the next step!

Step 3: How Much House Can You Afford?

An important step in the home buying process is determining how much house you can afford. This is calculated by looking at your monthly debts, household income, and available savings. This process will help you determine if you need to pay off some debts or save up more because lenders tend to give out the lowest rates to those with low debt, substantial down payments, and high credit scores. In general, lenders don’t recommend looking for houses that cost more than 3-5 times your annual household income. This rule of thumb applies to buyers that make a down payment of 20% and have a moderate amount of other debts. 

Step 4: Get Prequalified for Credit

Once you know how much house you can afford, it’s time to look at how much you can spend. To get prequalified for credit, you’ll need to provide your mortgage banker with some financial information such as your income, savings, investments, and so on. After they review your information and tell you how much they can lend you, you’ll have an idea of your home price range target. Then you can get preapproved for credit, where you’ll need to provide documentation such as W-2s, bank account statements, and more. Remember, use the information you received in step 2 to increase your chances of getting preapproved!

Step 5: Start Looking for Homes

Once you know your price range, you can work with a real estate agent and begin searching for homes! Since you’re likely going to be touring a lot of houses, you’ll want to take photos or videos and make some notes on your phone or a piece of paper. Remember to not only look at the house but make a note of the neighborhood and surrounding area. How are the schools? Are there grocery stores nearby? How far is the commute from your job?

Step 6: Make an Offer

When you’ve finally found the home of your dreams, your real estate agent will help you with your offer. Real estate agents have extensive knowledge of the industry and great negotiating skills that will help you reach a fair price for the home. Once you agree on a price with the seller, the house goes into escrow while you complete the home buying process. 

Step 7: Get a Home Inspection

You’ll want to have the home inspected a couple of days after the seller’s accepted the terms. The offer will be contingent on the home inspector checking for any damage or problems with the home that weren’t originally disclosed. Depending on the results, you’ll either move on to the next steps or have the chance to renegotiate or withdraw your offer. You can also ask the seller to fix any damages that come up in the report before closing the sale.

Step 8: Choose a Mortgage Loan

Shop around and find a loan that works best for you. Everyone has different priorities, resulting in lenders offering many different loan programs. Whether you want to pay it off quickly, keep your payments low, or prevent your rate from changing, there’s a loan out there for you. 

Step 9: Close the Sale

If everything goes well, it’s time to close the sale and celebrate! During this step, you’ll get all of the paperwork in order and sign the final documents. Once the seller received the payment, it’s time to get ready to break out the cardboard boxes and packing tape!

We hope our blog about the 9 steps to buying a home helps make the process a little easier! Again, if you want to understand your overall strength as a borrower, Mortgage Number is the first-ever platform of its kind that simplifies mortgage qualifications. It’s completely free and incredibly fast!