- Home
- Your Financial Future
- Buying a Home
Getting Started
Owning a home is an exciting prospect, though the buying process can be daunting. Here’s a breakdown of easy questions to ask yourself when starting your journey to home ownership.
What Can I Afford?
The amount you can afford to spend on a house is often tied to how large a mortgage you can afford. Mortgage lenders consider all your liabilities and obligations, including auto loans, credit card debt, child support, property taxes and insurance, and your overall credit rating. Use our house calculator to determine how much of a mortgage you may be able to obtain.
Should I Use an Agent?
A knowledgeable real estate agent or broker can guide you through buying a home and make the process much easier. This assistance can be especially helpful to a first-time home buyer as an agent or broker can:
- Show you properties and neighborhoods in your price range and provide insight into market activity
- Suggest sources and techniques for financing
- Prepare and present an offer to purchase
- Act as an intermediary in negotiations
- Recommend professionals whose services you may need (e.g., lawyers, mortgage brokers, title professionals, inspectors)
- Disclose positive and negative aspects of properties you're considering
*Keep in mind that if you enlist the services of an agent or broker, you'll want to find out how he or she is being compensated (i.e., flat fee or commission based on a percentage of the sale price). Many states require the agent or broker to disclose this information to you up front and in writing.
Protect Your Purchase
Making the Offer
Most home sale offers and counteroffers are made through an intermediary, and all terms and conditions of the offer are put in writing. It's a good idea to have your attorney review any offer to purchase before you sign.
Once the seller has accepted your offer, next steps to buying a home include preparing the mortgage loan, appraising the house, surveying the property and getting homeowners insurance. Typically, offers are contingent upon the satisfactory completion of a home inspection.
The Closing
During the closing process, you'll need to provide proof you have insured the property. You'll also be required to pay certain costs and fees associated with obtaining the mortgage and closing the real estate transaction.
You'll receive and/or sign a variety of paperwork, including:
- Closing Disclosure: This lists the final terms of the loan you've selected.
- Promissory Note: This spells out the amount and repayment terms of your mortgage loan.
- Mortgage: This gives the lender a lien against the property.
- Deed: This transfers legal ownership of the property to you.
