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From saving for a down payment, to finding the right home and securing a deal, here’s a guide to help you through the process.
Get a rough estimate of how much you could borrow with our mortgage calculator, to give you an idea of the type of property and location you could afford. It could also help you work out how much you’ll need to save for a down payment.
If you’re a first-time buyer, some lenders may be able to lend you up to 97% of the purchase price or valuation.
Make a savings plan if you don’t have enough for a deposit. You can create a budget to see where you can spend less and save more.
It’s a good idea to save as much as you can when trying to buy a home, because:
When you apply to borrow money, lenders look at your credit score before deciding whether to approve your application. Your credit score shows how reliable you’re likely to be at repaying money.
So check your credit report – which contains your financial information and credit score – before you start looking for a home to make sure there are no mistakes. Even something small, like an incorrect old address on your file, can affect your credit score negatively.
Improving your credit score increases your chances of getting a mortgage and a lower interest rate.
Explore: How to check your credit report
Take time to think about what’s important for your home versus what you’d like. This will help narrow down your search for properties.
| What you need in a home | What you'd like in a home |
|---|---|
| At least 2 bedrooms | 3 bedrooms |
| Space for parking | A garage or your own driveway |
| Outdoor space for a dog | A private, low-maintenance garden |
| What you need in a home | At least 2 bedrooms | At least 2 bedrooms |
|---|---|---|
| What you'd like in a home | 3 bedrooms | 3 bedrooms |
| What you need in a home | Space for parking | Space for parking |
| What you'd like in a home | A garage or your own driveway | A garage or your own driveway |
| What you need in a home | Outdoor space for a dog | Outdoor space for a dog |
| What you'd like in a home | A private, low-maintenance garden | A private, low-maintenance garden |
Think about your long-term needs when making your list. House prices can go down as well as up and it can cost money to move. If you’re hoping to start a family, for example, finding a larger place with room to expand might mean you won’t have to sell to buy a bigger place in the near future.
Location is also important. Visit and research different areas to get an idea of:
Explore: Buying a home
A pre-approval letter from a lender is evidence you’ll likely be accepted for a mortgage when you apply.
Based on the information you give about your down payment, income, and other financial details, a pre-approval letter shows you should be able to secure a mortgage for a certain value.
This tells real estate agents and sellers that you’re serious about buying and you’re able to raise the finance to do so – which helps when you’re making offers.
You’ll also know how much you qualify to borrow, so you can narrow down your home search.
It’s usually quick and free, with no obligation if you don’t find the right home.
With your list of requirements in mind, it’s time to contact realtors, search for properties and arrange viewings. This is also a good time to start looking for an attorney to help you with the buying process.
If you’re buying with a mortgage, don’t forget to consider including a mortgage contingency in your offer. Otherwise, if your offer is accepted but you’re unable to secure a mortgage (despite being pre-approved), your earnest money deposit is protected. This is a deposit of 1-3% of your property value paid to your seller in good faith.
If your final offer is accepted - well done! If not, keep searching - your new home could be just around the corner.
Once your offer has been accepted, you can now apply for a mortgage.
There are many types of mortgages to choose from, and the best one for you will depend on your financial situation, the type of property you’re buying, and your future plans.
If you’re unsure about the process or what type of mortgage is best for you, speak to a mortgage consultant. They’ll look at your financial situation and goals, and help find a mortgage that’s suited to your needs.
The mortgage application process involves detailed checks of your finances. Your lender may also want to conduct their own valuation of your property.
If your mortgage application is approved, your lender will send you an offer.
There'll always be legal work involved when buying a property, which you’ll need to factor into the overall cost.
Among other tasks, your attorney, title, or escrow company (depending on your state) may:
You should arrange an independent inspection of your own to flag any potential problems in addition to one your lender may arrange. An inspection only takes a few hours and is completed by a professional home inspector.
If the inspection identifies any significant work you’ll need to carry out, you may have to revisit your offer with the seller.
When you make your offer, you can include an inspection contingency to protect you if any major repairs are needed – this way, you’ll be able to withdraw your offer or renegotiate if you need to.
Your mortgage lender will also carry out a home appraisal for your property to check that your home’s value is in line with similar properties on the market in the same area.
A closing agent will help you and your seller complete your purchase. You’ll need to sign legal documents, including your Closing Disclosure, and pay for any final closing costs.
Closing is a big milestone that may even call for a celebratory dance. Now you just have to pick up your keys and start enjoying your new home!
