An Essential Checklist for Homebuyers

If you're feeling overwhelmed, trying to understand the home buying process, you're not alone. Our step-by-step overview can help make sense of the home buying journey

1

Determine what you can afford

Consider what your monthly payments are today and what they will be after you purchase a home. Key factors include:

Income

What is your monthly income?

Debt

What monthly payments do you have (auto, insurance, mortgage)?

Credit score

Do you pay your bills on time, are in good standing with credit bureaus or have any errors on your credit report?

Closing costs

How much money will you need at closing?

2

Get pre-qualified

Getting pre-qualified means that a lender has reviewed your income, expenses, and credit report and has conditionally agreed to loan you a set amount of money for a mortgage. While you're not required to provide verification documents prior to receiving a loan estimate, pre-qualification enables you to look for a home at or below that price level with confidence.

5 things you’ll need for pre-qualification

Proof of income

Proof of assets

Good Credit

Employment verification

Documentation

3

Search for a home

Checking online is a fast and convenient way to search for homes. It may also help to drive through neighborhoods you’re interested in, talk to your friends, or consult your agent, if you already have one.

4

Visit open houses and tour homes

Visiting homes in person can help you identify the features that are most important to you. While it is easy to get emotionally attached to one home, you will likely encounter multiple homes that suit your needs. It also helps to ask questions and bring a tape measure.

Buyers typically search for 10 weeks and look at an average of 10 homes.

Source: National Association of Realtors
5

Submit an offer

You found your new home, and you’re ready to make an offer. Your agent can help prepare your offer, which includes your offer price, establishing contingencies, obtaining disclosures, and establishing a closing timeline as part of your mortgage application process. Be prepared to negotiate the purchase price if the seller presents a counteroffer.

1

Submit your offer as soon as you can. Avoid delaying your offer as someone else may get in ahead of you.

2

Don't forgo inspections. Inspections will help you understand the home and any issues before closing.

3

Submit a strong, sensible offer. If it's too low, the seller may overlook it. If it's too high, you may have regrets.

6

Get a home inspection

A thorough home inspection will help you identify any issues with the home and determine whether there are repairs that need to be addressed prior to close and what future projects you may need to take on as the new homeowner.

7

Get an appraisal

An appraisal is an estimate as to the value of your home from a professional appraiser. Lenders require an appraisal prior to issuing a mortgage and will coordinate this for you.

Critical components for an appraisal

Comparable Sales

Square Footage

Appearance

Amenities

Condition

8

Renegotiate

If problems arise during the inspection period, you may be able to renegotiate the home's purchase price to account for any repairs that are needed. If changing the purchase price is not an option, consider asking the seller to pay for repairs.

1

Proceed with no requested repairs (a good option if issues are minor).

2

Request repairs. It is common to request repairs to bring the home into good working condition.

3

If repairs are significant and the seller will not budge, be prepared to walk away.

9

Close the sale

On closing day, all parties will sign the papers officially sealing the deal, and ownership of the property transfers to you.

Most important docs you’ll sign

Settlement statement

Summary of final fees and charges.

The promissory note

The legal “IOU” with home loan terms, payment dates and where they must be sent.

Deed of trust or mortgage

The document in which you agree to a lien on your property as security for repayment of your home loan.

The deed

The transfer of ownership from the seller to the buyer.

Homebuying Essentials

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