House hunting tips on how to find a house to buy

Buying a house can be one of the most exciting times of your life. Before you decide to move forward on a home purchase, though, it’s important to ask yourself a few questions and explore how to balance your wants and needs with your budget.

We’ve put together a complete house hunting guide to help you find the home that’s right for you at a price you can afford.

How to find a house to buy: 5 steps to follow

Taking some important steps will help you embark on the house hunting journey as well as feel prepared and confident once you find a house to buy.

Step 1: Determine your budget and start the approval process

Before you begin house hunting, figure out how much home you can afford. Use a budget calculator to estimate the mortgage payment that works for your financial situation. Keep in mind that your mortgage payment isn’t the only cost you’ll incur each month as a homeowner. Be sure to factor these expenses into your budget, too:

• Property taxes
• Homeowners insurance
• Home maintenance and upkeep
• Homeowners association (HOA) fees
• Utilities (gas, electric, water)
• Unexpected expenses (medical emergencies and unforeseen home repairs)

Use a mortgage calculator to estimate your monthly payments based on factors such as the home price, down payment, loan repayment term and mortgage interest rate. Be sure to get a mortgage preapproval with a preapproval letter, which is different from a prequalification letter. Here’s a breakdown of the two:

• Prequalification letter: When a lender says you’re prequalified for a certain amount, they’re giving you a rough estimate of what you can afford based on a verbal confirmation of your income and any outstanding debts.
• Preapproval letter: A preapproval letter from a mortgage lender states the mortgage loan amount that you’re likely to qualify for. Since the amount is calculated from financial documentation, and not just self-reported numbers, it carries more weight than a prequalification letter.

Many real estate agents won’t work with buyers until they secure a mortgage preapproval – even if they’re prequalified.

If you want to increase your chances of making a successful offer, consider getting a Verified Approval Letter (VAL)¹ from Rocket Mortgage^®. A VAL can make your offer stand out in a competitive market because it shows sellers that your financial profile – including your assets, credit score and income – has been thoroughly vetted by our Home Loan Experts. In other words, Verified Approval shows that you’re qualified and ready to buy.

Step 2: Create a list of must-haves and nice-to-haves

To ensure you start on the right foot, take some time to prioritize what you want before you start shopping for a home. Consider listing each room you’d like your house to have, then going room by room and describing each room’s ideal features.

Organize these features into three categories: must-haves, nice-to-haves and deal-breakers. When you’re done going room by room, consider must-haves and nice-to-haves for the home as a whole.

Must-haves

When something is a must-have, you simply can’t live without it in your home and you’ll use it to weed out homes that just won’t work. For example, you might absolutely need three bedrooms to accommodate your family. Or, you might need a room with plenty of natural light for your remote home office. Maybe you covet lots of garage space for extra storage.

If a home doesn’t include one of your must-haves but boasts the space or potential for renovations to make it happen in the future, you may want to keep the house on your list as a viable option.

Nice-to-haves

Nice-to-haves are wishes, not essentials. They’re features you’d like to have in a home, but they aren’t at the top of your priority list. You might prefer that your new home has a pool, updated appliances, a spiral staircase or a fire pit, but none of these preferences are deal-breakers.

Once you’ve narrowed down your list of houses, you can use your nice-to-haves to decide between your final candidates.

Step 3: Browse house shopping websites and apps

Browse houses for sale on your phone or computer to get a feel for your local housing market. House hunting websites can reveal how much homes sell for in your area, on average, and provide a more realistic idea of the type of home you can afford.

Researching homes online also allows you to scope out potential neighborhoods for schools, shopping, crime rates and anything else you might want to consider. Apps can help streamline your process, providing organized access to listings.

Compare your home buying budget to marketplace prices. Then, write down a few addresses and contact your real estate agent or the real estate companies that listed the homes you’re interested in.

Step 4: Connect with a real estate agent Or REALTOR^®

A reliable real estate agent or REALTOR^® is an expert in your local market who can make house shopping easier and less stressful. They can help narrow your search, give you a better idea of how to get the most out of your budget, and show you more homes than you’ll be able to view on your own.

Rather than steering you toward homes with a higher asking price that will likely boost their commission, a good real estate agent or REALTOR^® will carefully consider your individual needs when suggesting homes for you to view.

So, what’s the difference between a real estate agent and a REALTOR^®?

• A real estate agent is a professional who’s passed the necessary licensing examinations to do real estate business in your state.
• REALTORS^® are real estate professionals – including real estate agents – who are members of the National Association of REALTORS^®. They must hold a valid real estate license, be active in the market, adhere to a strict code of ethics and have a clean professional conduct record.

A real estate agent who is or isn’t a REALTOR^® can be a great help while house hunting. It’s best to work with a real estate professional who’s certified as an Accredited Buyer’s Representative (ABR^®). You might also consider a professional who holds a real estate broker license, which means they’ve furthered their real estate education.

Ask for references from previous home buyers and interview a few candidates before committing to an agent. Since you’ll be spending a lot of time together, choose an agent whose personality meshes well with yours, and make your expectations and needs clear upfront.

Step 5: Visit houses in person

Many sellers have open houses where anyone can tour their home. You can also arrange personal viewings with your real estate agent.

When viewing a home, don’t be afraid to be a little nosy. Test outlets, showers, toilets and kitchen appliances to make sure they work. Make a mental note of repairs or replacements you might want to ask the seller to complete if you end up making an offer on the house.

Visit neighborhoods in person, Too

Where you buy a house is just as important as which home you buy. Your real estate agent can help you explore neighborhoods as well as properties. Drive around areas you’re interested in and compare local amenities and features while keeping your budget top of mind. As you tour more homes and check out each neighborhood, you’ll get a better idea of the right home and community for you.

Other house hunting Tips

Still having trouble finding the perfect home? Here are some more house shopping tips.

Consider short sales and foreclosures

If you’re coming up empty-handed in your home search, it may be time to think outside the box. Consider looking into short sales, foreclosures or other property types.

Short sales

A short sale is a real estate transaction that involves selling a property for less than the homeowner owes on the mortgage. Short sales are usually initiated by the homeowner through the lender in order to avoid foreclosure. As a home buyer, you can expect to find highly motivated sellers.

Foreclosures

Foreclosures are triggered by a lender when a homeowner has stopped making monthly payments. In many cases, the home has been abandoned or left in disrepair by the owner. In a foreclosure, the lender attempts to recover the money owed to them by forcing the sale of the home.

Both short sale and foreclosed homes can be less expensive than regularly listed homes, but you might have to do some extra digging to find them. You may need to search bank websites, look up government-owned listings, visit county offices or pay for a foreclosure listing service.

You should also expect a more involved and lengthy process than with a typical sale. An experienced real estate agent can do a lot of the heavy lifting for you if you want to explore these alternatives.

Look into starter homes

If you’re a first-time home buyer, you might want a starter home instead of a forever home. Starter homes are often smaller and more economical for those on a budget. Keep in mind that it’s possible to upsize in the future if you start out in a smaller home. When you’re ready, your real estate agent can likely point you in the direction of starter homes that fit your budget.

Keep your options open

While house hunting, you may realize that your wants and needs don’t align with your budget. For example, maybe your heart is set on a four-bedroom home but they’re all out of your price range. It’s time to make the hard decisions or get creative. Can you add a bedroom in a basement? Can you turn an office into a bedroom? A home that may appear off-limits could potentially make it back on your list.

If you’re still having trouble finding the right home, you might have to adjust your list of must-haves and nice-to-haves. If something on your nice-to-have list is preventing you from settling on a house within your budget, consider getting rid of it.

The bottom line: You can go house shopping with confidence

Finding the right home can take some time, and knowing how to shop for houses often requires some careful planning. Start by getting a mortgage preapproval from a lender and setting a budget. Then, look at your local housing market and pair up with a real estate agent who can help you find houses in your price range and make an offer when you’re ready. Decide what your ideal home needs and narrow your search from there.

When you find a few properties that interest you, schedule visits and attend open houses.

Are you ready to start house shopping? Start the mortgage approval process today.

¹ Participation in the Verified Approval program is based on an underwriter’s comprehensive analysis of your credit, income, employment status, assets and debt. If new information materially changes the underwriting decision resulting in a denial of your credit request, if the loan fails to close for a reason outside of Rocket Mortgage’s control, including, but not limited to satisfactory insurance, appraisal and title report/search, or if you no longer want to proceed with the loan, your participation in the program will be discontinued. If your eligibility in the program does not change and your mortgage loan does not close due to a Rocket Mortgage error, you will receive the $1,000. Client must submit the claim to Help@RocketMortgage.com or contact Client Relations at 1-800-863-4332 to complete and return a claim form to Client Relations in order to claim the $1,000. Additional information will be required for tax purposes. This offer does not apply to new purchase loans submitted to Rocket Mortgage through a mortgage broker. Rocket Mortgage reserves the right to cancel this offer at any time. Acceptance of this offer constitutes the acceptance of these terms and conditions, which are subject to change at the sole discretion of Rocket Mortgage. Additional conditions or exclusions may apply.