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Your Step-by-Step Guide to Buying a Home
- Todd Davidson
- May 5
- 7 min read
Updated: 1 day ago
Buying a home is one of the most significant financial decisions people ever make. Whether you're a first-time buyer or looking to upgrade, the process can feel overwhelming. But with the proper preparation and team by your side, it can be easy, stress-free —and exciting. Below is a step-by-step guide to help you navigate the journey to homeownership as well as some links/contacts to help you start putting together your team. Make sure and read all the way to the end to try out our Rent vs Buy Calculator to see if buying is the right thing for you today!
Step1. Assess Your Financial Readiness
Before you browse listings or visit open houses, take a clear look at your finances. This includes:
Credit Score: Lenders use this to determine your mortgage eligibility. A higher score can secure better interest rates. To learn about getting a free report check the Consumer Financial Protection Bureau website > https://www.consumerfinance.gov/ask-cfpb/how-do-i-get-a-free-copy-of-my-credit-reports-en-5/
Savings: You'll need money for a down payment (typically 3%–20% of the home's price) and closing costs.
Debt-to-Income Ratio: Lenders assess how much of your income goes toward debt payments. All debts are included in this calculation. The minimum monthly payment for all student loans, car loans, credit cards, personal loans, home loans... are factored in and compared to your income to see if you qualify.
Pro Tip: Did you know you can apply and get pre-approved for a mortgage without doing a hard pull on credit? CLICK HERE and hit APPLY WITH ME to sign up and fill out an application. I can tell you if and what you would qualify for by only doing a soft pull on your credit (no impact on your credit score). I can even put together a mortgage quote to show you interest rate, closing costs, and $ needed. This is a great way to start the process and find out what you're able to afford/get approved for. Or if you don't approve currently I can help you put together a plan to get there.
Step 2. Get Pre-Approved for a Mortgage
Getting a pre-approval letter from a lender is one of the more critical steps in buying a home. It shows sellers you're a serious buyer and gives you a clear idea of your price range. It involves a formal application, credit check, and verification of your financial details. A good lender can help you navigate credit issues, job changes, retirement income, lower down payment options, buying while selling another home, and many other potential obstacles. To find out more about the pre-approval process and what's needed, I've put together an informative blog post that walks you through the process and details the documents you'd need > https://www.livinginoregon.net/steps-to-getting-pre-approved
Step 3. Find the Right Real Estate Agent
A great agent can make a huge difference when buying a home. They'll help you understand the market, find listings, negotiate offers, and handle paperwork. An experienced agent can also help with other local contacts you'll want/need for buying a home, moving, and maintaining your new home. Look for someone local, experienced, and communicative. If purchasing in the Portland Metro area, Elizabeth Davidson is the preferred agent for the Portland Metro area and can help > https://www.elizabethdavidson.com/. For other regions in Oregon, fill out our Realtor Connect form, and we can connect you with one of our other preferred realtors throughout the state > https://www.livinginoregon.net/realtorconnect .
Step 4. Start House Hunting
The fun part in buying a home to most is the house hunting. To start, make a list of your must-haves and nice-to-haves. Consider factors like:
Location and commute
School districts
Neighborhood amenities
Neighborhood demographics (retirees, families with kids...)
Size, layout, and condition of the home
Home amenities and features
Yard size and upkeep needs
Be prepared to view several homes and move quickly in a competitive market.
Step 5. Make an Offer
Once you've found the right home, your agent will help you make a competitive offer. This may include contingencies (like financing or inspections) and earnest money (a deposit that shows you're serious). An experienced realtor makes a real difference in this step as they know the questions to ask and levers to pull to help get your offer accepted. They also help insure the offer is written up correctly and protects your interests. It's also a sign to the seller/selling realtor that the transaction is likely to go smoothly and get completed.
Do you want to set up a Zoom or call to talk about getting pre-approved and/or buy a home? Below is a link to my calendar. Click on it and pick a time/day that works for you. Or just click EMAIL ME at the bottom of the article to connect and schedule > https://calendly.com/todddavidson/introduction-meeting
Step 6. Offer Accepted, What's Next?
Once you have an accepted offer a few things will happen right away:
Updated Documents: Your lender will ask for a few updated documents. Most recent paystubs, bank statements, and other documents will be needed before your loan is sent to underwriting for final approval (underwriting/underwriter is who vets all your info and gives final approval on your loan.)
Earnest Money Deposit: You'll send in the agreed upon amount of earnest money to the Title Company (third party working on behalf of the buyer, seller, and lender to complete the transaction)
Disclosures: Your lender will need you to sign disclosures (documents your lender is obligated to send you/have you sign for full transparency of the terms of the mortgage they are offering you.)
Interest Rate Lock/Float: You'll want to discuss locking or floating your interest rate with your lender and the benefits of each.
Homeowners Insurance: Work with your insurance agent to set up homeowners insurance for your new home. If you don't have one you like or want to shop around, your lender will likely have someone to recommend.
For more info on the mortgage process, types, costs, title, locking check out this blog post about 18 Mortgage FAQs > https://www.livinginoregon.net/post/18-mortgage-faqs
Want to buy but not Ready to Apply?
Step 7. Schedule Inspections and Appraisal
Home Inspections: Identifies potential issues (roof, plumbing, foundation, etc.). You can renegotiate or walk away if the inspection reveals major problems. Consider more specialized inspections depending on your area, condition, and age of the house. A good realtor should have several inspectors to refer you to that have done a good job for their past clients.
Appraisal: Confirms the home's value matches the price, which protects the lender. This will get scheduled by your lender through the AMC (appraisal management company.) The AMC reaches out to you directly to pay for the appraisal via credit card. Once paid the appraiser will reach out to the listing agent, in most cases, to schedule.
Step 8. Finalize Your Mortgage
By this point you'll likely be conditionally approved for your mortgage. Work with your lender to get any additional documents/things the underwriter needs, along with appraisal results, and if all goes well your loan will be approved. Or otherwise known in lending circles, you'll get Clear to Close!
Step 9. Close the Deal
This is the final step in buying a home! The title company and lender have put together your final documents and the title company will call to schedule signing and give you the final amount you'll need to pay to close. At time of signing you'll:
Review and sign a stack of documents
Pay your down payment and closing costs, usually via wire transfer before signing. The title company will give you exact instructions and amount. Do not send money until you have the instructions and better yet talk to escrow agent at the title company on the phone to confirm.
Sale will close with the county the afternoon of closing day. Once it does you'll get the keys to your new home.
Congratulations—you're now a homeowner!
Final Thoughts
Buying a home is a process, but it doesn't have to be stressful. With solid preparation, a knowledgeable team, and patience, you can find the perfect place to call your own. Happy house hunting!
On the fence on whether you should buy or rent? Try our rent vs buy calculator below to see if renting versus buying makes more sense for you today from a payment standpoint.
Want to discuss buying a home?
Click below to get the ball rolling. Email me to set up a Zoom and find out more about moving to or within Oregon, Washington, or Arizona, get a mortgage quote, connect with a realtor to buy and/or sell, or anything else you need to help you buy a home.
Todd Davidson
Mortgage Loan Officer
P: 971-275-2465
About the Author:
AI and author knowledge were sources of info for this blog. The info was vetted, links to other resources included, and portions written by Todd Davidson, a seasoned professional in home ownership and mortgage financing. With a passion for helping individuals and families make successful transitions to new states and homes, Todd has become a prominent influencer in the industry. As a Mortgage Loan Officer with years of experience, Todd has guided countless clients through the intricacies of home financing, making their dreams of homeownership a reality.
As an author, influencer, and mortgage loan officer, Todd Davidson brings a wealth of knowledge and a genuine passion for assisting others in achieving their housing and moving goals. His dedication to the well-being of his clients and readers shines through in his work, making him a trusted resource for anyone embarking on the exciting adventure of home ownership.
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