Home Buying: From Search to Final Walk-Through

Congratulations, you are ready to buy a home! It is an exciting step in life, but it can be overwhelming, especially if it is your first time. Despite the long list of to-do items required on the home-buying checklist, it generally follows a set process. With some determination and organization, you can turn buying your home into a memorable and exciting experience.

Step one: Get your needs straight

The most important thing to do first is to decide what you want and need in a home. This will include everything from the part of town you would like to live in, the type of neighborhood you prefer, what school districts you would like to be zoned to and what type of house you want. You will need to think about whether you want to find a move-in ready home or build it. Once you have all of these items settled, the search process can begin!

Step two: Determine what you can afford

This may be the most sobering part of the process, but it is an important step to take. After all, you do not want to get your hopes up about that perfect house without knowing whether you will be able to afford it. First, go over all of your finances, including income and debt. The 36% rule, which measures your debt relative to your income, is a good guideline to follow. It states that your total debt divided by your gross monthly income should not exceed 36%.

In fact, this is the formula that mortgage lenders will use when approving you for a mortgage loan, so it is a good idea to get pre-approved for a mortgage loan before you begin looking at homes. Though you will still have many more financial hurdles to cross before the loan is finalized, it is an excellent starting point and puts you ahead of competing buyers.

Step three: Find the home of your dreams

Now comes the fun part: searching through available homes to find the perfect one for you! Depending on the market, this could be a very fast or very slow process. You may also decide to choose a floor plan and build on a lot you select if you do not find a perfect move-in ready or under construction home. Of course, often you will just know a house is "the one" regardless of how many you see, so if that happens for you, good luck with getting it!

When you find one you love, it is time to get serious about purchasing! You will schedule an appointment with a sales professional who will guide you through the contract process and accept your earnest money payment.

Step four: After your decision, when things get rolling

Once your decision is made, great! To secure your place, you will put down earnest money and move forward with your loan application. This is the period during which buyers will get their finances in order. The loan approval process will take awhile, and the pace at which you help move this along will determine your closing date. During this time, your sales professional will work with you to ensure everything is going as planned. Within two weeks, you should get a call informing you of the status of your loan.