A Simple Guide to Buying a House in 2021


Michael Idarola, Mortgage Expert
Posted January 29, 2021

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Buying a home in 2021 can be a challenging and rewarding process. By learning the process of buying a home ahead of time, much of the stress the accompanies the home buying process can be relieved when you decide to move forward because you know what to expect. The following steps can equip those who want to become homeowners with success. 

1. Determine if You’re Ready

Buying a home is likely to be the largest single purchase you ever make in your life. Not surprisingly, the first thing you need to figure out is if you are financially ready to become a homeowner. 

While demonstrating to your lender that you have a sufficient amount of income so that you can afford the monthly payments is important, your work history, debt-to-income ratio, and credit score are critical factors in the decision to qualify for home purchase financing.

2. Determine how much house you can afford

Figure out what your debt-to-income ratio is and how much money you can earmark for a mortgage payment. In addition to the monthly mortgage payments that you’ll be responsible for, remember to calculate property taxes, homeowners insurance, and maintenance costs as well. 

3. Start Saving for a Down Payment

One of the best-case scenarios of buying a home is that you put some money down to purchase the house. Traditionally, loan programs suggest 20% down, however, there are several programs such as an FHA loan that will allow you to put as little as 3.5% down and others that may have an allowance for no money down.

If possible, aim to save at least 20 percent of your home’s cost. Doing so can open up more options for a mortgage, such as not having to pay for private mortgage insurance (PMI). If you don’t have 20% to put down, talk to your mortgage advisor about programs that allow you to put down less.

4. Get Preapproval

In today’s hot real estate market, many sellers won’t entertain offers by a borrower unless they have lender preapproval in hand first. Not only does a preapproval demonstrate the seriousness of your intentions to purchase the home, but it also gives you a realistic view of how much of a house you can afford. 

5. Find a Real Estate Agent

While it is possible to buy a home without the help of a real estate agent, it is highly recommended that you work with one, especially if you are purchasing your first home. This professional has an extensive network that can help you find the right home for your needs. In addition, a real estate agent knows how to protect you and guide you through negotiations. 

6. Narrow Down Houses

When looking for a house, consider its location, price, square footage, number of bedrooms, and similar attributes. You might also want to determine if having a yard, swimming pool, or easy access to nearby entertainment and shopping are important to you. 

7. Make an Offer

Your real estate agent will guide you through the process of making an offer on a home, but the basics are pretty much the same. The offer letter details your personal details as well as the price you want to pay for the home and the deadline when the seller must get back to you. 

Once it is received, the seller can either accept the offer or reject it. They can also provide you with a counteroffer. 

8. Arrange for a Home Inspection

A home inspection is a service performed by a professional who objectively inspects the home while noting any issues. In most cases, the inspection report will include details about any problems that were found and recommendations regarding if they should be addressed before you buy the home. 

9. Schedule an Appraisal

Your lender will require that your home be appraised before they approve of a mortgage. Because an appraisal determines the home’s current value, it helps the lender avoid lending out too much money for a property.

10. Complete a Final Walkthrough

Even if you are completely committed to purchasing a home, it’s recommended that you complete a final walkthrough. This allows you to ensure that the seller’s belongings are gone and that they have made any repairs as promised. 

The closing disclosure kicks off the final step of the home buying process. Make sure you read through this entire document as it details the particulars of your loan and the amount you’ll pay at closing. 

Attend the closing meeting, bringing proof of funds, the closing disclosure and your ID. Sign your settlement statement and pay the down payment and closing costs. 

The final two documents you’ll sign are the mortgage note which states that you promise to pay the loan. The deed of trust or mortgage is the final document you need to sign off on before officially becoming a homeowner. 


Hi, I'm Michael Idarola
Your Mortgage Loan Officer & Mortgage Expert.

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Your Mortgage Expert

I'm Michael Idarola

Hi, my name is Michael Idarola. I'm a Mortgage Expert with Premier Lending Inc., offering personalized mortgage or home loan solutions, customized mortgage quotes, great rates, and personalized service. I'd love the opportunity to help you get into a home you love with a home loan you can afford.