A Step by Step Guide to Homebuying for First Time Homebuyers A Step by Step Guide to Homebuying for First Time Homebuyers
Buying your first home is an exciting milestone—but the process can also feel overwhelming if you’re not sure where to begin. From assessing your financial readiness to closing on your dream home, each step requires preparation and confidence. This guide breaks down the homebuying journey into clear, manageable stages so first‑time homebuyers know what to expect and how to set themselves up for success.
Understanding Whether You’re Ready to Buy
Before you begin scrolling through listings or visiting open houses, it’s important to determine whether now is the right time to buy. Assessing your financial and personal readiness sets a strong foundation for the rest of the journey.
Evaluate Your Financial Health
Your first step is reviewing your overall financial picture. This includes looking at your credit score, current debt obligations, monthly spending, and emergency savings. A higher credit score may help you qualify for better mortgage rates, while a stable income and manageable debt make it easier to navigate monthly payments once you’re a homeowner.
Build or Strengthen Your Savings
In addition to a down payment—often between 3% and 20% of the home price—you’ll need funds for closing costs, moving expenses, and initial maintenance. Even if you don’t have the full down payment saved yet, you can start mapping out a savings plan that gets you there steadily.
Consider Your Long‑Term Plans
If you expect to stay in the area for several years, buying may be a smart financial choice. But if your job situation or life plans are in flux, renting may give you more flexibility. Homebuying is a major milestone, so aligning it with your lifestyle goals is key.
Step 1: Determine Your Budget
The next part of your homebuying roadmap is understanding what you can comfortably afford.
Calculate Your Price Range
Most lenders recommend that your total monthly housing costs—including mortgage, taxes, and insurance—stay within 25–30% of your gross monthly income. Use this guideline to map out a realistic price range before falling in love with a home that’s outside your budget.
Understand Additional Costs
Beyond the down payment, factor in closing costs (typically 2–5% of the home price), home inspections, potential repairs, and longer‑term maintenance. Knowing the full financial picture helps ensure you’re prepared and avoid surprises later.
Step 2: Get Pre‑Approved for a Mortgage
Pre‑approval shows sellers you’re a serious buyer and helps you understand exactly how much you can borrow.
Why Pre‑Approval Matters
A mortgage pre approval provides a lender verified snapshot of your finances. When you find the right home, being pre approved positions you to make a stronger offer—especially in competitive markets.
Why First‑Time Buyers Love This Step
This is often the moment when buying a home starts to feel real. You’ll see loan options, estimated monthly payments, and how different price points and interest rates affect your finances.
Step 3: Find the Right Real Estate Agent
A trusted real estate agent is your advocate throughout the homebuying journey.
What a Good Agent Does for You
A good agent helps you navigate neighborhoods, interpret listing details, identify red flags, negotiate offers, and guide you through the paperwork. For a first‑time homebuyer, having an expert you trust removes a tremendous amount of stress.
Step 4: Start House Hunting
Now comes the fun part—exploring homes and discovering what you love.
Make a Prioritized Wish List
List your must‑haves (like location, number of bedrooms, or parking) and your nice‑to‑haves. This keeps you focused as you tour homes in person or online.
Stay Flexible
It’s normal to refine your wish list as you see homes. Flexibility helps you spot real opportunities—especially when the market is competitive.
Step 5: Make an Offer and Negotiate
Once you’ve found “the one,” your agent will help you submit an offer.
What Goes Into an Offer?
Your offer includes the proposed price, contingencies (like inspection or financing), and the expected closing date. Depending on the market, you may negotiate repairs, credits, or timing to reach an agreement that works for both sides.
Step 6: Inspection and Appraisal
These steps ensure the home is safe, sound, and valued appropriately.
Home Inspection
A licensed inspector evaluates the home’s condition. If issues are discovered, you may negotiate repairs or credits before moving forward.
Appraisal
Your lender orders an appraisal to confirm the home’s market value. This ensures the price aligns with the financing being provided.
Step 7: Close on Your New Home
Closing day is the final milestone before you get the keys.
What Happens at Closing?
You’ll sign your loan documents, finalize payments, and officially become the owner. Congratulations—you’ve completed the homebuying journey and stepped into an exciting new chapter.
Ready for the Next Step? Here Are Two Helpful Paths
Still Saving for Your Down Payment?
If you’re building your down payment, consider Leader Bank’s Homeowner CD, designed specifically for homebuyers. It offers a competitive 4.00% APY* along with an additional 4.00%** annualized bonus if you close on a Leader Bank mortgage within six months—plus penalty‑free access for your closing.
Ready to Shop for a Home?
If you’re ready to start your search or want expert guidance on loan options, connect with one of Leader Bank’s experienced Loan Officers. Their team is here to help you navigate each step of the mortgage process with confidence.
This is for informational purposes only, and nothing contained herein constitutes investment advice.
*Annual Percentage Yield (APY) effective as of 12 January, 2026. New money only. Minimum balance to open and earn APY is $1,000. Interest rate of 3.96% for 6 Month CD. $100,000 maximum deposit. Only one CD per household; business entities are not eligible for this product. A penalty may be imposed for early withdrawal from a Certificate of Deposit prior to maturity; Fees may reduce earnings.
** To receive the 4.00% annualized bonus, eligible clients must apply for a first lien closed end mortgage loan with Leader Bank, N.A. on or after December 25, 2025, and close on said loan on or before the initial maturity date; such bonus will be paid at the initial maturity date. If a client redeems their CD on or before the initial six-month maturity date to apply such funds towards the closing on a purchase or refinance with Leader Bank, any early withdrawal penalty shall be waived and the client shall be eligible for the 4.00% annualized bonus. Leader Bank retains the right to determine whether the use of proceeds or early redemption meets these criteria. The 4.00% annualized bonus may be earned only in the initial six-month term of the CD; if the CD renews into a new term, client shall not be eligible to any additional bonus and the APY of the renewal term will be determined by Leader Bank in its sole discretion with prior notice to client.
