Making a Home Purchase: A Step-by-Step Guide
Buying a home—especially for the first time—is a big step for you and your family. To help you be prepared for a smoother purchase process, we’ve outlined the eight common steps you can expect when buying your new home.
8 Common Steps To Buying A Home
1. Set Your Budget
A home purchase is a big deal. Understand your budget from the beginning so you can shop smartly. We recommend getting pre-qualified for your mortgage to help you set your budget, and if you have financing questions meet with your loan officer. We can help you get pre-qualified—start your application online right now.
2. Start Shopping
With your real estate agent, search for the perfect place to now call home. When you’re ready, your real estate agent helps you negotiate the terms of the sale, which can include price, possession date or concessions.
3. Lock Your Mortgage Rate
Your offer is accepted! Now is the time to revise your mortgage application and loan estimate to reflect the details of your real estate contract, and to lock in your interest rate. Down payment and mortgage length specifics will be confirmed at this step.
4. Processor Mortgage Review
You’ve completed everything and now your mortgage request is reviewed by a loan processor, who will ensure all documents are collected and correctly completed. The processor then provides your packet to us—or your mortgage company—for final approval.
5. Home Inspections, Appraisal & Insurance
Depending on the house age, location and other circumstances, various inspections may be recommended. This provides you (the home buyer) to address any issues with the seller. Your real estate agent is a valuable resource for getting these scheduled for you. You will also need an appraisal to support the purchase price for your mortgage. It’s also time to contact your insurance agent for appropriate coverage. Mortgage companies require fire and hazard insurance and, in some cases, flood insurance. Your insurance provider can help you determine the coverage your new home needs.
6. Abstract & Title
The abstract documents the property history and any liens (mortgages, judgements, mechanic liens) that might be against it. An attorney provides the title opinion; it is required that any liens be cleared so the title is clean before closing.
7. Underwriter Review & Final Approval
The underwriter uses the information shared by the loan processor (see step 4) to officially approve your mortgage. Additional information may be requested at this time. Once approved, final financing details are shared along with the closing date, time and location.
Congratulations! This is the moment all final mortgage documents are reviewed and signed. Bring your photo identification and, if needed, a certified check with applicable closing funds. Your purchase is complete—welcome to your new home!