Organize your finances

First, you’ll want to look at your current debts and income, then consider how much money you can reasonably afford to spend each month on a mortgage. From there, you’ll want to determine your credit score, as this directly impacts what loans and interest rates you qualify for. Try reducing your debt as much as you can to help improve your score. Remember: When calculating the cost, don’t forget to include your down payment, closing costs, property taxes, and homeowners insurance.

Get prequalified

Before you start searching for a house, it’s important to know just how much house you can afford. Get prequalified in person or online, but be sure to have proof of employment, assets, and income tax returns on hand. After you apply, your lender will give you a preapproval letter stating how much you’re approved for based on the information provided. Show this letter to your real estate agent so they can help find homes in your budget.

Find a real estate agent

Begin by asking family members and friends for recommendations. Direct referrals are often the best way to get unbiased information on agents in your area. Remember: These agents are local market experts and can advise you on how much to offer on a property, as well as write an offer letter and assist in negotiations. As a buyer, you can usually work with a real estate agent for free, as their commission tends to be covered by the seller.

Hunt for home

This is where you get to have some fun. Make a list of the top priorities you’re looking for in a home, including items like square footage, number of bedrooms, backyard/swimming pool, school district ranking, or local entertainment options. Share this list with your agent, who will then search for the right homes that meet your criteria. Once you find a property that meets your needs and budget, it’s time to make an offer.

Make an offer

When you decide to make an offer on a home, your agent will help you submit an offer letter in writing. Your offer letter will include basic personal details and the price you’re willing to pay. It will also include a deadline for the seller to respond to your offer. From here, the seller can respond in one of three ways: accept the offer, reject the offer, or give you a counter offer. Remember: Don’t be afraid to walk away if you can’t reach an agreement.

Inspect and close

Once you and the seller agree to an offer, you’ll need to schedule an inspection and appraisal. An inspector will go through the home to make sure it’s safe and that everything is in working order. A home appraisal will identify the current value of the property, which lenders require to ensure they’re not lending more than the home’s value. At your closing meeting, you’ll sign a settlement statement that lists all costs related to the home sale. You’ll then pay your down payment and closing costs (if applicable) and sign the mortgage note, which states that you promise to repay the loan. Once you sign the mortgage or deed of trust, you’re officially a homeowner!