The Complete Guide to Buying a Home, From Mortgage Purchase to Closing

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Interested in buying a home in 2021? Learn the eight steps you need to take from start to finish. (iStock)

With record low mortgage rates and surging home prices, many Americans are interested in buying a home in 2021. However, the process of buying a home can seem quite daunting – lenders will check your credit rating, you will need a pre-approval letter. your personal information will be exposed and you will make extremely important financial decisions.

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Consider the points below as a guide to buying homes in 2021. If this is your first time buying a home-ready home, here are eight steps you need to take if you’re just getting started.

8 steps to buying a home in 2021:

1. Save on the down payment.

When you are preparing to buy a home, most lenders will require you to make a 20% down payment. If you can’t shell out that much, you can still buy a house. For example, FHA loans allow you to buy a home with just 3.5% down payment.

But if you cannot mortgage 20%, you may have to purchase private mortgage insurance (PMI), which will protect your lender if you stop making payments. So it’s a good idea to save some time on your down payment.

2. Increase your credit rating to 620 points.

It is common knowledge that you need a good credit rating if you want to qualify for the best mortgage rates. However, an ideal credit rating is not a requirement for buying a home.

If you have had difficulty getting a loan in the past, try to score at least 620 points. You can do this by paying bills on time, lowering your debt-to-income ratio, and avoiding opening any new lines of credit. at that time.

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If you are not sure what your credit rating is, visit Credible to check your account without negatively affecting him.

3. Determine how much you are willing to spend.

Before you start looking for housing, it is important to find out how much housing you can afford. You can use this online mortgage calculator to determine your potential monthly payments.

Buying a home isn’t all about monthly mortgage payments, however. You should also consider homeowners association fees, service and utility costs.

4. Purchase homes in your price range.

Now that you know what type of home you can afford, you can start looking for homes that fit your price range. Take some time to think about the must-have features you want your home to have. This way, you will be ready to act quickly once you find your ideal home.

5. Get pre-approved for your mortgage and lock in your rate.

Buying a home is fun in and of itself, but buying a mortgage lender is perhaps the most important part. Your lender will determine the type of rate and repayment terms that you will receive on your mortgage.

It’s a good idea to apply with multiple lenders so you can see who is offering you the best rates. If you are using mortgage broker like Credible, you can receive personalized offers from multiple lenders without affecting your credit score.

6. Make an offer for the house you want

Once you find the home you want to buy, it’s time to propose. You should work closely with your real estate agent throughout this process to ensure that your offer is competitive and has the best chance of being accepted in the bidding war.

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Once the seller accepts your offer, you may be required to pay a deposit. This is the bond that you pay on the house and you can use that money to cover your final closing costs.

7. Get a home inspection and assessment.

Before you can buy a home, you need to have it inspected and appraised by an appraiser to make sure there are no problems with the property. A professional home inspector will check the foundations and look for any mechanical or structural problems that might warrant home renovation.

During the certification, it turns out that the house is worth the price the seller is asking for. The appraiser will check the home and compare it to similar homes on the market.

8. Close your house

The day you’ve been waiting for has finally arrived – it’s time to close your new home. Before closing your home, take a moment to review your latest information and check your closing costs.

On the closing day, you will conduct a final inspection of the property, sign the documents and pay the closing costs. From there, you will receive the keys to your new home.

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The essence

The more informed you are about the home buying process when you’re ready to buy, the less stressful it will be overall. From pre-approving your mortgage to determining the loan amount and homeowner insurance, steps are required, from simple to more complex.

Working with a qualified real estate agent and mortgage lender will help you feel more confident in your decisions when it’s time to buy. Be sure to visit You can contact experienced loan officers who can answer all your questions.

Have a financial question but don’t know who to contact? Write to a safe money expert at moneyexpert@credible.com and your question can be answered by Credible in our Money Expert column.

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