Determine a Price Range:
The first step in buying a house is determining how much you can afford. When you apply for a mortgage loan, the lender will apply certain criteria to determine how large a loan to make. The amount depends mainly on your income and how much debt you currently have. You can run through a similar analysis to provide an estimate of your loan limit.

The best way to do this is to get pre-qualified. Pre-qualifying will help you narrow your search to houses you can afford and will give you more negotiating power with the seller.

Select a Home:
Find a house that suits you and your needs. A visit to the brokerage office allows you to find out about a large number of homes on the market by looking through exclusive and multiple listings with an agent. A broker can also help you narrow down the list to the location, features, and price you desire. In addition, a broker can arrange an inspection tour of available homes.

Make An Offer:
After finding the home you wish to buy, you can make an offer by submitting a sales contract. Any offer is subject to a contract being signed. There are no legal obligations on either side until the contract is signed.

Your offer will be accompanied by a check to signify serious intent. This earnest money is typically less than five percent of the price of the home and is forfeited if you back out of the contract. If the deal falls through because of one of the conditions in the contract, your deposit is returned.

Obtain Financing:
When a lender and loan type decision has been reached you can prepare to make a loan application. Take some time to gather information on your current income, major debts and available cash (or assets that can be converted to cash readily). If you are self-employed or work on commission, you may need income tax returns for the last three years to establish your income.

Prepare to Close:
In the time before the closing, there are several things that must be done. Ways in which this transpires can vary. In many areas it is customary for the seller to arrange for a title search and, at closing, purchase a title insurance policy in the name of the lender and/or buyer. This policy assures good title and protects against claims of ownership or partial interests. The buyer must arrange for a hazard and liability insurance policy to be written for the new house. Such a policy is required for the mortgage loan. A new survey will be made of the property to make sure no building is encroaching on surrounding property. A termite inspection is typically required. The buyer may exercise the right under the contract to hire a housing inspector to report any non-functioning equipment or unsafe building condition. Recall that the sales contract may require the seller to repair any broken component up to a certain dollar limit. Such repairs should be completed before closing.

Close:
On closing day, all parties will meet and execute the necessary paperwork to pass title of the property. Closing generally takes place at the offices of the title insurance company. The buyer and seller are present or represented, along with legal counsel, if required. Also present will be the real estate broke, if one has been involved, and a representative of the mortgage lender. Closing day is considered the first day of ownership for the buyer, and all benefits and responsibilities are conferred at this time.