Close with confidence.

You’re one of a kind. Your mortgage should be, too. Start an application to see what’s possible.

How soon do you want to buy a home?

the Home Buying Process (explained)

If there’s anything in life you can control with certainty, it’s where you live! From equity, to emotional value…to short and long-term security, owning a home can become one of the most rewarding parts of your life.

Whether you’re finding out how much house you can afford, comparing interest rates on mortgages, or searching for a place to retire, we’ve put together all the information you need so you can get started.

Buying a Home

Purchasing a home is a significant milestone, but for first-time home buyers who are unsure of what to anticipate, the process may be as scary as it is thrilling. In these uncertain times of high list prices and low interest rates, the decision to buy a house may feel more daunting than ever, but we’re here to help.

We’ll walk you through each of the important phases involved in buying a house in this post, so you know exactly what you’re getting into and how to prepare.

The Home Buying Process In 3 Easy Steps

During a real estate transaction, a lot of critical information is transferred, and you’ll want to make sure you’re knowledgeable enough to advocate for your needs every step of the way. The best way to prepare is to know exactly what to expect. Here are the steps you must take before receiving the keys to your new home:

Step 1: Check Your Credit Score

Obtaining financing isn’t always simple. Mortgage lenders use your credit score and financial history to determine loan eligibility, so it’s critical to be one step ahead of them and know where you stand.

To qualify for a conventional loan, you must have a FICO® score of 620 or higher. However, if you qualify for an FHA loan, Canopy Mortgage, LLC requires only a 580 credit score. The VA does not require a specific credit score in order to purchase a home with a VA loan, but lenders are free to set their own policies. For these loans, lenders usually require a credit score of at least 620.

Your credit and financial history will determine whether or not you can get a mortgage and at what interest rate. Buyers with higher credit scores tend to get better interest rates and loan terms, so make sure you understand your credit before diving in.

Step 2: Determine How Much You Can Afford

Consider using our Home Affordability Calculator to determine how much house you can afford. Once you’ve determined how much you can afford, think about the lifestyle you want to maintain and leave yourself a safety net in case of an emergency. In your budget planning, don’t forget to account for things like retirement, college funds, and family vacations.

Step 3: Select a Lender and Get Pre-Approved for a Mortgage

Getting prequalified for a loan, contrary to popular belief, does not guarantee that you will be able to obtain one. Lenders only estimate your finances when you get prequalified based on the information you provide.

Getting preapproved for a loan, on the other hand, necessitates a thorough investigation of your finances, which includes verification of your income, assets, and credit rating. When you get preapproved for a loan, you know you’ll be able to get it if your finances don’t change between preapproval and closing on the house.

A preapproval is useful because it specifies the costs of obtaining the loan as well as how much the lender is willing to lend you. Being preapproved also shows the seller that you’re serious about purchasing, which can make a difference if you end up in a bidding war.