Everything you need to know about buying a home, in 7 steps

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May 18, 2017 8:54 PM

From teaming up with a realtor and finding out what you can afford to closing on the deal, here are all the steps it takes to buy a home.

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Buying a house is no walk in the park.

It takes a lot of organization, careful thought, and, of course, money.

But if you're serious about becoming a homeowner, you need to get prepared for the road ahead.

To help out, Business Insider consulted Dana Bull, a realtor with Sotheby's International in Boston, and George Chedid, a realtor with Century 21 Barrood in Kendall Park, New Jersey, to put together a timeline of the homebuying process.

Below, check out the seven steps you'll take to buy a house, from teaming up with a realtor and finding out what you can afford to closing on the deal, and everything in between.

Step 1: Build your team and determine your price point

A home is a huge purchase, so you'll want to make sure you're making as few mistakes as possible along the way. That means putting together a team of people you trust, including a real estate agent, lender, and lawyer, which is often the bank's attorney, says Bull.

Estimate what you can afford

The general rule of thumb

Step 2: Get pre-approved for a loan

In most cases if you plan to get a mortgage, you need a loan pre-approval in hand before you can start looking at houses — most realtors won't entertain shoppers who don't have one.

Crunch the numbers

Pick your lender

Step 3: Shop for homes

Step 4: Make an offer and get inspected

Once you've found the home of your dreams, it's time to make an offer. The seller may flat out reject your offer, counter your offer, or accept it. If they counter, you may accept their counter, or you can counter their counter offer. Your real estate agent will want to know your top budget beforehand and will negotiate on your behalf.

Home inspection

Attorney review

Purchase and sale agreement

Step 5: Apply for your mortgage

The lender should be keeping tabs on interest rates because they fluctuate daily. It's usually locked right after the purchase and sale agreement, but if the rates drop significantly, it can be relocked.

key difference

Appraisal

Step 6: Do a final walk-through

Once the mortgage is obtained, the lawyers will set a date for a final walkthrough and a closing. The final walkthrough usually takes place a day before the closing and it's a time when the buyers can physically confirm that the house is in the condition as agreed to in the contract, says Chedid.

Step 7: Close on the property

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