Buying your first home is a huge accomplishment for which you should be proud.
However, it usually comes with some hesitation because you don’t know which step to take first.
What's in this article?
The homebuying process involves an assortment of steps, decisions and considerations.
That’s why we’ve put together a checklist of initiatives that first-time home buyers can take as they begin their homebuying journey.
Assess your financial health
The first step in your homebuying journey is to evaluate your financial situation. This includes:
- Budget: Determine how much you can afford to spend on a home, including down payment and monthly mortgage payments. Consider your income, expenses and long-term financial goals. Make sure you consider fun expenses too, such as dinners or vacations. Keep those in mind so they remain in the budget.
- Credit Score: Check your credit score, as it will significantly affect the interest rate and ultimately your approval. If necessary, take steps to improve your credit, such as minimizing as much debt as possible and disputing anything that is wrong on your credit report. Take care of this ahead of time so your credit score has time to reflect the hard work you put into it.
- Savings: Ensure you have sufficient savings for up-front costs such as closing fees, moving expenses and emergency funds. Aim to save at least 3-6 months’ worth of living expenses. You never know what you might need. Just when you think everything is going well, an appliance or an expensive heating system could break down, for example.
Get a Loan Commitment
Before starting your home search, secure a mortgage loan commitment with Compass Mortgage. This will give you a clear understanding of your buying power and demonstrate to sellers that you can secure financing.
With Compass Mortgage, borrowers can get a fully underwritten loan commitment even before they find the home they want to buy with Get Committed®.
As a demonstration of our commitment to our clients, we lock in your mortgage rate and terms up front so that you can use the full power of your offer on the market.
Choose the right real estate agent
Partnering with a knowledgeable real estate agent who understands the local market and your specific needs can significantly improve your home-buying experience.
Look for an agent with a proven track record, excellent communication skills and obvious concern for your best interests.
Define your home needs and wants
Prior to beginning your house hunt, it’s wise to compile a list of essential features and desirable extras you’d like in a home.
Take into account aspects like the number of bedrooms and bathrooms, the total living area, the availability of outdoor space and the location’s convenience to your workplace or school. This will help you focus your search and make better decisions when viewing properties.
Research neighborhoods
Investigate potential neighborhoods to ensure they fit your lifestyle, safety requirements and future goals.
Consider factors such as:
- Amenities: Look for neighborhoods with access to parks, shopping, dining and entertainment options that align with your preferences.
- Schools: If you have children or plan to start a family, research the quality of local schools and their proximity to potential homes.
- Safety: Check crime rates and neighborhood safety statistics to ensure you feel comfortable in your new community.
- Future Value: Consider the potential for appreciation and resale value in the neighborhoods you are considering.
Attend home viewings and open houses
Once you have a list of potential homes, schedule viewings and attend open houses.
Inspect each property thoroughly, taking note of its condition, layout and any potential defects.
Consider bringing a trusted friend, family member or professional inspector to provide an objective perspective.
Make a thoughtful offer
Upon finding a home that fits your criteria, collaborate with your real estate agent to submit a competitive offer, considering the market analysis and your financial plan.
Your agent will guide you through the negotiation process and help you reach an agreement with the seller on price, contingencies and closing dates.
Home inspection and negotiation
After your offer is accepted, schedule a professional home inspection to identify potential flaws or repairs that may be needed.
Based on the inspection findings, you may need to negotiate with the seller for repairs or credits.
Your agent will assist you in these negotiations to ensure your interests are protected.
Finalize mortgage and closing details
As your closing date approaches, work with your lender to finalize your mortgage.
Choose the best mortgage option for your needs, considering factors such as interest rates, loan terms and monthly payments.
Review and sign all necessary paperwork. Prepare for closing costs, which typically range from 2-5% of the purchase price.
Plan your move
With your home purchase finalized, it’s time to plan your move.
- Notify important parties of your address change
- Set up necessary utilities and services (internet, gas, water, electricity)
- Pack belongings by room and label each box
- Coordinate with movers, or plan a DIY move
- Forward your mail and update your driver’s license
Pave the way to your dream home with Compass Mortgage
Don’t let uncertainty hold you back from achieving your homeownership dreams.
Apply now with Compass Mortgage, and let us help guide you to your dream home.
Our expert team is ready to answer your questions, provide personalized guidance and support you throughout the entire process.