Buying your first home is one of the most significant financial decisions you will ever make. The process involves dozens of steps, multiple professionals, and enough paperwork to fill a filing cabinet. This checklist breaks it all down into 10 manageable steps so you can move forward with confidence.
Step 1: Check Your Credit Score and Report
Your credit score is the single biggest factor in determining your mortgage rate. Pull your free credit reports from all three bureaus at AnnualCreditReport.com and review them for errors. Common mistakes include accounts that are not yours, incorrect balances, and outdated negative items.
If your score is below 620, spend three to six months improving it before applying. Even a 40-point improvement can save you thousands. See our guide on how to boost your credit score for specific tactics.
Step 2: Determine Your Budget
Use the 28/36 rule as your baseline: no more than 28% of gross income on housing costs and 36% on total debts. Our affordability calculator can give you a personalized estimate in minutes. Be honest with yourself and leave a buffer for unexpected expenses.
Step 3: Save for Your Down Payment and Closing Costs
You will need money for two big categories: the down payment (3% to 20% of the purchase price) and closing costs (2% to 5% of the purchase price). For a $300,000 home, that means having $15,000 to $75,000 available. Look into down payment assistance programs that can reduce your out-of-pocket costs significantly.
Step 4: Get Pre-Approved for a Mortgage
Pre-approval is different from pre-qualification. Pre-approval means a lender has verified your income, assets, and credit and has committed to lending you a specific amount. This gives you credibility with sellers and clarity on your price range. Apply with at least two to three lenders to compare rates. Use our get started page to begin the process.
Step 5: Find a Real Estate Agent
A good buyer's agent knows the local market, helps you negotiate, and guides you through the paperwork. As a buyer, the seller typically pays your agent's commission, so this expertise costs you nothing. Look for agents with experience in your target neighborhoods and price range. Check our find a realtor tool to connect with agents in your area.
Step 6: Start House Hunting
Now comes the fun part. Make a list of must-haves versus nice-to-haves and stay disciplined. Visit at least five to ten homes before making a decision. Pay attention to the neighborhood, commute times, school districts, and future development plans, not just the house itself. Browse our property listings to start your search.
Step 7: Make an Offer
Your agent will help you craft a competitive offer based on comparable sales, market conditions, and the home's condition. Your offer should include the purchase price, earnest money deposit (typically 1% to 3% of the price), contingencies (inspection, appraisal, financing), and a proposed closing date.
Step 8: Get a Home Inspection
Never skip the inspection. A licensed home inspector will examine the structure, roof, electrical, plumbing, HVAC, and more. The inspection typically costs $300 to $500 and can reveal issues that could cost thousands to fix. If major problems are found, you can negotiate repairs, a price reduction, or walk away.
Step 9: Navigate the Closing Process
Once your offer is accepted and contingencies are cleared, you enter the closing phase. This involves the appraisal, title search, final loan approval, and a mountain of documents to sign. Review your closing costs carefully and compare the final numbers to your Loan Estimate. The closing disclosure must be provided at least three business days before closing.
Step 10: Close and Get Your Keys
On closing day, you will sign the final documents, pay your closing costs, and receive the keys to your new home. Before signing, do a final walk-through to make sure the property is in the agreed-upon condition and any negotiated repairs have been completed.
Buying your first home is a marathon, not a sprint. Take it one step at a time, lean on professionals, and use tools like our mortgage calculators to stay informed at every stage.