Buying your first home is an exciting milestone, but it can also feel overwhelming if you’re unfamiliar with the process. From getting pre-approved to understanding the costs involved, this guide will walk you through everything you need to know to navigate the journey of homeownership with confidence.
1. Get Pre-Approved Before You Start House Hunting
Before you start touring homes, the first step is getting pre-approved for a mortgage. This crucial step helps you:
- Determine how much home you can afford.
- Show sellers you’re a serious buyer.
- Speed up the buying process once you find the perfect home.
To get pre-approved, you’ll need to get in touch with a lender (Irena can send you some recommendations!), then provide that lender with documents like proof of income, credit history, and employment details. They’ll review your financial situation and issue a pre-approval letter, which you can present when making offers on homes.
2. Understanding the Costs of Buying a Home
Buying a home involves more than just the purchase price. Here are some common costs to prepare for:
Upfront Costs:
- Down Payment – Typically ranges from 3% to 20% of the home’s price, depending on loan type.
- Earnest Money Deposit – A good-faith deposit (1-2% of the purchase price) to show your commitment to buying the home. This deposit gets applied to your purchase when you close!
- Home Inspection Fee – $400 to $800, paid to a professional inspector to assess the home’s condition.
- Appraisal Fee – $700 to $900, required by lenders to determine the home’s market value.
Closing Costs (Typically 2-5% of the Purchase Price):
- Loan Origination Fees – Charged by lenders to process your mortgage.
- Title Insurance – Protects you and your lender against property disputes.
- Property Taxes – You may need to prepay several months’ worth at closing.
- Homeowners Insurance – Often required by lenders before finalizing your loan.
Ongoing Costs:
- Mortgage Payments – Includes principal, interest, taxes, and insurance.
- Homeowners Association (HOA) Fees – If applicable, for community maintenance.
- Utilities & Maintenance – Regular upkeep and repairs to keep your home in great shape.
- Property Taxes – You can pay this separately, or factor it into your monthly payment.
3. The Home Buying Process: Step-by-Step
Step 1: Work with a Real Estate Agent
A knowledgeable real estate agent like Irena Kolbert will guide you through the process, negotiate on your behalf, and help you find the right home within your budget.
Step 2: Start House Hunting
With your pre-approval in hand, begin viewing homes that fit your criteria. Take notes, consider your must-haves, and compare options.
Step 3: Make an Offer
Once you find the perfect home, your agent will help you submit an offer. The seller may accept, reject, or counter your offer.
Step 4: Home Inspection & Appraisal
After your offer is accepted, schedule a home inspection to check for potential issues. Your lender will also order an appraisal to confirm the home’s value.
Step 5: Finalize Your Mortgage
Work with your lender to finalize your loan details, submit required documents, and get final approval.
Step 6: Closing Day
Review and sign all necessary paperwork, pay the down payment + closing costs, and receive the keys to your new home!
Final Thoughts
Buying your first home is a major step, but with the right preparation and guidance, it can be a smooth and exciting process. Understanding the costs involved, getting pre-approved, and working with a trusted real estate agent will set you up for success.
If you’re ready to start your home-buying journey, I’d love to help! Reach out today to discuss your goals and find the perfect home for you.
Irena Kolbert
Award-Winning REALTOR®
John L. Scott
360-712-6860
