10 Steps to buying a house in 2025

How do I start the process of buying a house?

After months or years of preparing your finances, you’re finally ready to buy a house. It’s an exciting time, but the process can be overwhelming for a first-time home buyer. You might ask: Should I house hunt or get a mortgage first? How does the mortgage application work? How do I make an offer?

This guide walks through the ten basic steps to buying a home. It will give you a better idea of what to expect, as well as concrete first steps to get started on your journey. Ready to begin?

1. Get pre-approved by a mortgage lender

Getting pre-approved for a mortgage loan before you make an offer on a home is key. This should be your very first step in the home buying process. Preapproval will help ensure that you qualify for financing and give you a better idea of your budget so that you know you’re making an offer on a home you can afford.

A mortgage preapproval involves completing a short application and submitting financial documentation to a mortgage lender. This includes tax returns, paystubs, W2s, and bank account statements. Lenders also check your credit history and credit score.

When you get preapproved, your lender will quote you an interest rate, determine a specific loan amount you’re eligible to receive, and issue a preapproval letter. This preapproval letter functions as proof of your eligibility for a mortgage loan and the seller will want to see it when you make an offer.

2. Go house hunting

Your preapproval letter is a green light to start house hunting. There’s no rule that says you must work with a real estate agent. However, it’s a good idea for first-time home buyers especially to enlist the help of Realtor. Your agent can pull listings in your target area, schedule showings for homes within your price range, and — most importantly — help you craft a winning offer and negotiate with the seller.

Before starting the home search, make a list of your “must-have” features and “wants.” This includes the desired number of bedrooms and bathrooms, ideal locations, home style (condo, single-family, etc.), square footage, and other specific features. Think ahead of time about which features are deal-breakers so that you’ll know when it’s worth bidding more on a home or walking away.

For more information, see: What to look for when buying a house.

3. Make an offer and negotiate

Once you find a property, your real estate agent can help you craft a strong offer. Based on similar recently sold homes in the area, they might recommend an offer that’s above, below, or at the asking price.

Your agent can also provide guidance when asking for seller concessions and including contingencies. It’s not unusual for an offer to be contingent on a satisfactory home inspection. But depending on the local market, your agent might advise against asking for closing costs assistance.

You’ll include your preapproval letter with the offer. The seller will then either accept, reject, or counter it. Once your offer is accepted, you’ll pay an earnest money deposit. Earnest money is “good faith” money that shows you’re a serious buyer.

4. Finish your mortgage application

Once the seller accepts your offer, you’ll submit the purchase agreement to your mortgage lender. This officially starts the mortgage process and you’ll receive a revised Loan Estimate with mortgage details for that specific property.

Next, your loan file goes through underwriting. During the underwriting process, your mortgage lender will take an in-depth look at your credit, income, debts, and financial history to verify that you qualify for the mortgage loan.

Even though you’ve already submitted your financial information during the preapproval phase, you might need to provide additional documentation. For example, if a family member gifts your down payment or closing costs, you must provide a gift letter from the donor.

Additionally, the underwriter might have questions or “conditions” regarding details on your credit report or bank statement. A “conditional approval” that asks for additional documentation before your final approval is common, and nothing to worry about. But you should respond to your lender’s inquiries as soon as possible to avoid closing delays.

5. Get a home appraisal

A mortgage lender will not lend more than a property is worth. Therefore, a home appraisal is required to determine the home’s fair market value.

During the underwriting process, your lender will hire a third-party appraiser to conduct this evaluation. The appraiser takes note of the home’s features, age, and condition, and then compares the property with similar homes in the area. They assess the home’s value using comparable sales.

If the home appraises below your agreed-upon sales price, you may need to re-negotiate the price with the seller or cover the appraisal gap in cash. If the appraised value is at or above the purchase price, the sale should be able to move forward as planned.

6. Get a home inspection

A home inspection isn’t required when buying a house, but it’s highly recommended. These inspections can reveal hidden problems with the home. And if so, you can ask the seller to lower the sale price or address these before closing.

Home inspectors check the interior and exterior of the home (plumbing, electrical system, HVAC, roof, foundation, and other structures). If a seller refuses to fix major issues, you can back out of the home purchase as long as your contract is contingent on a satisfactory inspection report.

Note that a home inspection can uncover issues that would not be revealed with an appraisal, as inspectors take a far more in-depth look at the property’s structure and systems. So don’t count on your appraiser to do the job of an inspector; use this opportunity to make sure you know all about the property’s condition before buying.

Some sellers will have an inspection report available before you make an offer to expedite the process. But you may want to order your own independent inspection even if the seller already had one completed.

7. Get final approval from the lender

Once your lender receives all necessary documentation including the appraisal report, the underwriter conducts one final credit check. They’ll take a last look at your loan file, and if everything is in order, they’ll issue a final loan approval and schedule a closing date.

You’ll receive and sign your Closing Disclosure at least three business days before closing. This form includes actual details about your mortgage including the monthly payment, interest rate, and the amount of cash you need to close.

It’s important for your credit and financial situation to remain the same during the mortgage process. So you shouldn’t switch jobs, take on new debt, or open new credit accounts prior to closing. Any changes to your financial situation or credit score could put your mortgage approval in jeopardy.

8. Do a final walk-through

You’ll schedule a final walk-through of the property a couple of days before closing. You can walk through the property to confirm the completion of any repairs and to make sure there are no issues with the property. The walk-through occurs once the seller removes all of their belongings from the home.

9. Close your mortgage loan

The final step to buying a house is closing day. You’ll typically go to the closing agent’s office (a title company or real estate attorney) with a photo ID and certified funds to pay your down payment and closing costs. Or you may have already wired the funds for your upfront costs a few days beforehand. Some lenders now offer remote e-closings that you can complete in your own home.

On closing day, you’ll sign paperwork to finalize the details of your transaction and take ownership of the property. On average, closing takes between one and two hours. You’ll receive a copy of the closing documents and the keys to your home.

10. Move in

Once you’ve closed, you’ll receive the keys to your new home and you can move in when you’re ready. Congratulations!

Aside from packing and unpacking, post-closing and move-in tasks often include the following:

• Connecting or transferring utilities
• Checking smoke detectors
• Changing door locks
• Replacing air filters
• Scheduling professional house cleaning
• Updating your mailing address with the DMV, banks, employer, etc
• Completing a change of address form with the post office

Start the home buying process

There are many steps to the home buying process. But if you know what to expect and complete tasks in the right order, things should go smoothly. And keep in mind that you’re not alone. Your Realtor and loan officer will be there to guide you every step of the way.

When you’re ready to get started, reach out to a mortgage lender to start your preapproval. This is the first step to buying a house and will help you understand what you can afford before you go house hunting.