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Buying your first home can seem overwhelming at first.

If you break it down into a few simple steps, you can feel much more confident about what to expect and start to focus on how exciting this phase of your life really is.

1. Save Up for Your Down Payment and Closing Costs

Start saving up for your down payment. Some traditional home loans require as much as 20% of the home’s purchase price up front, while other types of mortgages require as little as 3% down. Reach out to one of our Loan Officers to see what’s best for your situation.

2. Clean Up Your Credit

First thing’s first – before you apply for any loan, you’ll want to check your credit report and score. You can get a free copy of your credit report from each credit bureau every 12 months at annualcreditreport.com. Be sure to review your credit report closely, and if you find any errors, dispute them right away. Correcting mistakes can take time, so start as soon as possible. For more information on how credit scores are calculated, read our other article here.

3. Determine How Much Home You Can Afford

Before you start shopping for houses, you’ll want to figure out your budget to get a good idea of how much home you can afford. Use our mortgage calculator to get started. This will give you a good idea of your budget.

4. Get Pre-Approved for a Mortgage

Another step you’ll want to complete before shopping for a house is to get pre-approved for a home loan with First American Bank. This will show sellers that you are a serious buyer with bank approval, which can help in the negotiation process. To get pre-approved for a mortgage, visit the First American Bank mortgage applications page.

5. Shop for a Home Within Your Budget

Now is when the fun begins – shopping for your next dream home. Before you start, you’ll want to figure out what amenities are required and which ones aren’t. Also, take into consideration the neighborhood where you’d like to live and the quality of the school districts. Find a good real estate agent by asking for a referral from your friends, family or banker. Remember that you may get approved for more than you can afford, since most calculators and mortgage companies don’t consider all expenses you may have. It’s wise to add a dose of common sense to any mortgage payment decision, so that you don’t feel stressed over the monthly payments. Talk to your First American Bank Loan Officer for guidance.

6. Put an Offer on the House You Want

When you find the home you’d like to buy, it’s time to make an offer and begin negotiations. Your real estate agent should be able to guide you through this process and handle everything on your behalf. Make sure you know what other comparable homes have recently sold for, too, so you can negotiate accordingly.

7. Put a Deposit Down

Once you and the seller have both agreed to the home’s purchase price, you’ll need to put down a deposit to show you are serious and secure the home. This deposit is commonly called earnest money and is held safely until closing.

8. Get Loan Approval

To get the financing for your home, you’ll need an approval from First American Bank. There are a variety of mortgage options, from fixed-rate mortgages and adjustable-rate mortgages to jumbo mortgages, FHA loans, VA loans and more. There are also numerous loan payment terms, typically 15 or 30 years for most loan types. Talk to your mortgage officer to figure out what works best for you and your family. View available home mortgage options from First American Bank.

9. Close the Sale on Your Home

Before you can move in, you’ll need to get a home inspection. This can be a great tool to figure out if there are any major defects with the house before you close. This can also help with your negotiation, as many buyers ask the seller to fix things or lower the price based on the inspection results. When you are satisfied with the condition of the house and final sales price, and your loan is fully approved, it is time to close. Closing is when you sign all of the paperwork and fund your purchase. You and the seller agree on a date to bring your down payment, the bank will wire the loan funds and you will sign loan documents. Congratulations, you are a homeowner!

10. Move Into Your New Home

Once you’ve gone through all those steps, you’ll be handed the keys to your new home. Start packing and calling up your friends to help you move, or get ready to hire a moving company. Don’t forget to set the date for your housewarming party!

Buying a home is one of the biggest milestones in your life and should be handled with care. Make sure you find friendly and knowledgeable people along the way to help you make this home buying journey positive. If you’re ready to talk to a mortgage officer, contact us at any time.