Important points:
Make a financial plan early and figure out how much you can afford. Find the right team – a good agent and lender can make a big difference. We organize everything from pre-approval to closing to make the process smoother.
You’ve been scrolling through listings for weeks, whether it’s a Craftsman-style home in Seattle, Washington, or a sunny condo in Nashville, Tennessee. It’s exciting, but also overwhelming. Between pre-approvals, inspections, and completing paperwork, it can be easy to lose track of what happens next. This is where a home buying checklist comes in handy. We can help you stay organized at every step of the home buying process, from finances to getting the keys. This checklist provides clear actions and tips for first-time homebuyers to make the process smoother and less stressful.
1. Find out how much home you can afford
Before you start viewing homes, make sure you have a clear idea of what you can comfortably afford. Calculate your debt-to-income ratio (DTI) by comparing your total monthly debt payments to your total monthly income. This will give you a realistic idea of how much you can try. Generally, the lower your DTI, the easier it will be to qualify for a mortgage and manage your monthly payments. Use our mortgage affordability calculator to estimate a target price range that fits your budget, so you can narrow your search and avoid getting hooked on a home that’s beyond your means.
Remember: Consider future monthly expenses (utilities, maintenance, HOA dues) so you can maintain a realistic budget beyond your mortgage payment.
2. Save for a down payment
Your down payment will affect the amount you need to borrow and the loan options available to you. Some loan programs allow down payments of 3% to 10% (some programs allow zero down payments), but a larger down payment can reduce your loan amount and monthly payments. You may also be able to build equity faster and avoid private mortgage insurance (PMI). You can create a dedicated savings plan by setting a target amount, schedule, and monthly savings goal, and steadily work towards buying a home.
Reminder: Check out local and state down payment assistance programs. Many programs offer grants and competitive loans that can help first-time homebuyers reduce their initial costs.
3. Improve your credit score
Your credit score plays an important role in qualifying for a mortgage and can affect interest rates and loan terms. Before applying for pre-approval, check your credit report for errors, pay off high-interest balances, and consistently make on-time payments. Lenders typically look for a strong track record of responsible credit use, and healthy credit makes it easier to borrow in the long run.
Simple habits to help improve your score:
Pay all your bills on time Reduce your credit card balances Avoid opening new credit accounts during the mortgage process
4. Find a reliable real estate agent
Working with the right real estate agent can make the home buying process smoother, faster, and much less stressful. A trusted buyer’s agent will provide local market expertise, help you determine if a property is priced right, guide you through home inspections and negotiations, and walk you through each step of the closing process.
Look for an agent who listens to your goals, communicates clearly, and understands your schedule and budget. Ask friends and family for referrals, or look at online reviews to find someone with extensive experience in your local area.
5. Get pre-approved for a mortgage
Getting pre-approved early in your home search will help you understand how much you can borrow and show sellers you’re a serious, qualified buyer. Pre-approval provides you with a verified loan amount based on your financial information, giving you a clear budget and helping your offer stand out in a competitive landscape. At this stage, you are not locked into a lender. Many buyers get pre-approved from multiple financial institutions in order to compare interest rates, fees, and loan programs before choosing one.
How to approach pre-approval:
Compare multiple lenders: Check interest rates, fees, and available loan programs such as FHA, VA, and conventional loans. Understand your options: Ask how different down payment amounts, credit profiles, and loan terms will affect your interest rate and monthly payments. Pay attention to service: Choose a lender that has clear communication and can explain the process in simple terms.
6. Research the area or neighborhood you want to live in
Choosing the right neighborhood is just as important as finding the right home. As part of your home buying checklist, take the time to explore different neighborhoods and communities to see which one best fits your lifestyle and long-term goals.
Here’s how to narrow your search:
Explore local amenities: Look for schools, grocery stores, parks, hospitals, and public transportation options. Check your commute: Try your route during rush hour to get an idea of your daily travel patterns. Try visiting at different times. Explore the area on weekdays, weekends, and evenings to get a feel for the liveliness and noise levels in action. Explore local trends: Check for new developments or future zoning changes that could affect home values.
Pro tip: Spend a weekend driving through the top three areas to get a real feel for each before you take the tour.
7. Make a list of must-haves (and nice-to-haves)
Once you’ve found a few areas you like, it’s time to define your home priorities. This focuses your search and helps agents tailor their recommendations.
Let’s start with the basics:
Home Type: Decide whether you want a single-family home, townhouse, or condo. Style Preferences: Think about your architectural style, whether you’re drawn to midcentury modern, Victorian, or newer contemporary designs. Size and layout: Think about how much space you actually need, including the number of bedrooms and bathrooms and whether you need a home office or flex room. Lifestyle Features: Outdoor area, garage, updated kitchen or walkable location.
Next, make a list of “nice to have” items. These are things you want but can live without, like a pool or a finished basement. Being clear about what’s most important to you will help you make decisions faster and more confidently when you find a home that meets your criteria.
8. Start your home tour
One of the most exciting parts of the home buying process is attending open houses and home tours. The tour will help you see what’s available in your price range, explore layouts, and compare features directly.
Take photos and notes during each tour so you can remember details later. Ask your agent for insight into the home’s condition and value, and don’t be afraid to ask about any cosmetic issues like cracks, leaks, or odors.
If possible, in addition to visiting homes in your desired neighborhood, visit nearby neighborhoods to broaden your horizons. If you’re relocating or short on time, take advantage of virtual home tours to evaluate your property from anywhere.
9. Make an offer
Once you find the “best fit”, make an offer. Your agent can help you determine a fair asking price based on comparable home sales and local market conditions.
Offer includes:
the price you are willing to pay. Contingencies (such as financing or inspections). Desired deadline. Typically, an earnest money deposit of 1 to 3 percent of the purchase price shows you’re serious.
Your agent will submit your offer to the seller, and from there they can accept, reject, or object. If they object, your agent will guide you through next steps, such as adjusting terms or moving to another home.
10. Negotiate
During negotiations, a good real estate agent brings real value and helps buyers and sellers close the deal. Your real estate agent can help you decide what to include in your offer. It can also help guide you on how to respond to a counter-offer if the seller disagrees with your initial offer but doesn’t reject it outright. They may counter requests for some or all of your offers. You can decide whether you are open to a counteroffer and whether you want to fight back. For more tips on how to successfully negotiate, check out our helpful article on whether you can negotiate the price of a home.
11. Schedule a home inspection
If your offer is accepted, your real estate agent will help you hire a qualified home inspector to evaluate the property for hidden issues or major repairs that could affect your investment. Although the inspection is not required by lenders, it is essential to understand the condition of the home before moving forward with confidence.
During a home inspection, an inspector checks the home’s structure, plumbing, electrical system, roof, HVAC, and foundation to make sure everything is safe and up to code. While almost all inspections will uncover at least minor problems, certain red flags can indicate more costly repairs.
Roof: Check for damaged or missing shingles. Windows: Check for fogging, moisture, and broken seals. HVAC and Furnace: Make sure the system is working properly and is not older than 15 years. Water heater: Check for rust, leaks, and signs of deterioration over 10 years. Flooring and paint: Assess for signs of wear, damage, or water ingress.
Use inspection reports to understand future maintenance needs and negotiate repairs and credits before closing. Even if there are some defects, knowing the true condition of the home will help you make an informed decision.
12. Get a home appraisal
After the home inspection, the lender will order a home appraisal to determine the fair market value of the property before closing the mortgage. The appraiser evaluates the home’s condition, location, size, and features and compares it to recent sales of comparable homes in the area (or “comps”) to determine an estimated value.
This step in the home buying checklist ensures that the home is worth what you agreed to pay for and protects both you and your lender from overpaying. If the appraised value matches or exceeds the offered amount, the loan will proceed smoothly. However, if the appraised value is lower than the asking price, you may need to renegotiate with the seller, increase your down payment, or dispute the appraised value.
13. Complete your mortgage
Once the evaluation is complete and the necessary conditions are met, the lender will move the loan to final underwriting. At this stage, the lender will check your financial documents again to ensure that nothing has changed and that you are still eligible for the loan. You may be required to provide recent bank statements, pay stubs, or documentation to meet last-minute requirements.
Once your loan is fully approved, you will receive a Closing Disclosure outlining the final loan terms and closing costs. Please check carefully. Your lender should send it at least three days before the closing so you have time to ask questions and make sure everything is accurate.
14. Work with a title company
If your offer is accepted, the title company will conduct a title search and public records search to confirm legal ownership of the home and uncover any liens, claims, or easements that may affect the transfer.
Once the search is complete, the title company will issue a title report and help arrange title insurance. This protects both you and your lender from potential title disputes in the future. Lenders typically require this coverage for both purchase and refinance transactions.
Pro tip: Review the title report carefully and ask questions if you have any questions. Addressing issues early can help you avoid last-minute surprises and ensure a smooth closing when you officially take ownership of your new home.
15. Finalize your home and complete your home buying checklist
At closing, you sign the final documents, pay any remaining costs, and officially transfer ownership from the seller to you. A title company or real estate attorney will process the paperwork, verify funds, and record the property deed with the county to ensure you are the legal homeowner.
Once everything is signed and the deed is recorded, you receive the keys and your home buying checklist is officially complete. This is a huge milestone, and it turns all of your planning, saving, and searching into the moment you finally get to call your new home home.
Optional: Consider having a real estate attorney review the closing documents.
Some states require a real estate attorney at closing (such as New York and some states on the East Coast). Even if not required, some buyers choose to have an attorney review the purchase contract and closing documents for added peace of mind.
