Steps to Buying a Home

Buying a home can be a complicated and stressful experience, but if you follow these easy steps to buying a home.

1. Determine What You Can Afford

Figuring out what you can afford can be a little tricky. There are online mortgage calculators that can help you determine the maximum loan you can afford. Your best bet is usually to contact your a mortgage lender for a preapproval.

2. Get a PreApproval

You want a mortgage preapproval, not a mortgage prequalification. With a mortgage preapproval the mortgage lender obtains a copy of your credit report, determines your monthly liabilities, verifies your monthly income, and determines how much money they will lend you to purchase a home.

3. Find a Good Realtor

Working with a good realtor will make the homebuying process much easier. The are tips to finding a good Realtor available on this blog.

4. Shop For A Home

Compile a wish list for your home. Be sure to include all the items your new home "must" have and all the items that you'd like, but are not essential. Include items such as a garage, swimming pool, number of bathrooms, etc. Give the list to your Realtor. Make copies of the list and use it as a checklist when you view homes.

5. Make an Offer

Have your Realtor work on the process with you. You're offer will either be accepted or denied. You may even receive a counteroffer. All offers should be contingent on receiving an acceptable home inspection.

6. Have the Home Inspected

Once your offer is accepted you should have the home inspected. Use a certified home inspector, not your Uncle Vinny that "knows a lot about houses." Your home is a big investment. This is not the spot to try and save money.

7. Get Home Owner's Insurance

Shop around for the best rates and coverages. Make sure you understand any terms that may be specific to your area, such as flood insurance, earthquake coverage or hurricane damage.

8. Close the Deal

It may seem like you are signing a phone book worth of papers, but make sure you read and UNDERSTAND everything. There are many homes in foreclosure now because home buyers did not understand the terms of their mortgage.

Buying a home may not be the easiest process in the world, but you can become a homeowner by following these simple steps to buying a home.