1. Figure out how much house you can afford.
- Calculate your monthly income and debt.
- Check your credit report and FICO score.
- Figure out your down payment.
2. Get pre-approved for a mortgage.
- Choose a type of mortgage.
- Speak to at least five lenders and mortgage brokers.
- Shop for the best interest rates and programs.
3. Determine what you want and need in a home.
- Choose a location (downtown, urban, suburban, rural).
- Choose a type (single family, townhouse, condo, loft).
- Choose a price range.
- Choose a size.
- Choose an architectural style.
4. Research your target neighborhoods.
- Look online for information on schools, crime rate, traffic and zoning.
- Determine your work commute.
- Scout local amenities, such as parks, shops and restaurants.
5. Work with a buyer’s agent who knows the neighborhood.
- Get referrals.
- Consider working with an exclusive buyer’s agent.
- Interview at least three agents.
- Look for experience and good chemistry.
6. Search for homes in the MLS and For Sale By Owner (FSBO).
- Ask your agent to set up tours of homes that fit your criteria.
- Check local newspapers.
- Pick up flyers and attend open houses.
7. Research each home you want to buy.
- Ask your agent for comps to estimate the property’s fair market value.
- Ask the seller’s reason for selling.
- Review all property disclosures.
- Find out about liens, easements or other restrictions.
8. Make an offer and negotiate.
- Determine the purchase price.
- Include contingencies, such as financial, inspection or purchase.
- Spell out any special requests and repairs you want included in the sale.
- Determine an earnest money amount.
- Define a move-in date.
- Once both parties agree to the terms, sign the Purchase and Sale Agreement.
9. Finalize the deal.
- Get the house appraised.
- Get a professional home inspection.
- Consider getting specific inspections for structural engineering, roof and termites.
- Use the appraisal and inspection reports to re-negotiate if necessary.
- Choose a home insurance company.
- Complete the loan process with the lender.
- Do a walk-through inspection prior to closing.
- Set aside cash for the closing costs and down payment.
10. Close the purchase.
- Review the settlement document at least 2 days before closing to see how funds will be collected and distributed.
- Get a cashier’s check for the amount you need to bring to closing, including the down payment and closing costs.