Buying a Home: A Step-by-Step Guide

Buying a home is one of life’s biggest milestones—and it’s exciting! But if you’re a first-time buyer, the process can feel overwhelming. At Deerwood Bank, we make things simple, transparent, and tailored to YOU. Whether you’re buying your first home or your forever home, here’s a step-by-step guide to help you navigate the mortgage process with confidence. 

Step 1: Know What You Can Afford 

Before browsing listings or touring homes, understand what fits within your budget. A good rule of thumb: keep your mortgage payment (including taxes and insurance) under 28% of your gross monthly income. Don’t forget to factor in utilities, maintenance, and HOA fees if applicable. 

Tip: Use this mortgage calculator to estimate monthly payments and find a comfortable price range. 

Step 2: Get Pre-Qualified 

Pre-qualification is a key early step—and at Deerwood, it’s quick and easy online. It gives you a clear idea of how much you can borrow and shows sellers you’re a serious buyer. 

What you’ll need: 

• Proof of income (pay stubs, tax returns) 
• Employment history 
• Credit history 
• Assets and debts 

Step 3: Find the Right Home 

Once pre-qualified, the fun begins! Work with a local real estate agent who knows the market and community. Be clear about your must-haves vs. nice-to-haves—and stick to your budget. 

Step 4: Make an Offer 

When you find “the one,” your agent will help you submit an offer. If accepted, you’ll sign a purchase agreement—this is when the mortgage process officially begins. 

Step 5: Apply for Your Mortgage 

Now it’s time to formally apply. A Deerwood Bank mortgage lender will help you choose the right loan type (fixed-rate, adjustable-rate, FHA, etc.). We’ll walk you through your options and find the best fit. 

You’ll receive a Loan Estimate outlining: 

• Interest rate 
• Monthly payments 
• Closing costs 
• Other key details 

Step 6: Home Appraisal & Inspection 

Your lender will order an appraisal to confirm the home’s value. Hire a professional inspector to assess the home’s condition—this helps uncover any hidden issues before finalizing the purchase. 

Step 7: Underwriting & Final Approval 

During underwriting, your loan file is reviewed in detail. The lender verifies your financials and property information. You may be asked for additional documents—respond promptly to keep things moving. 

Step 8: Close on Your New Home 

Once approved, you’ll receive a Closing Disclosure at least three days before closing. This outlines your final loan terms and costs. On closing day, you’ll sign paperwork, pay closing costs, and get the keys! 

Congratulations—you’re officially a homeowner! 

Ready to Get Started? 

Deerwood Bank helps thousands of Minnesotans achieve homeownership with local service, friendly expertise, and trusted advice. 

Start your pre-qualification online: https://deerwoodbank.com/home-mortgages/  

Questions? Our lending team is just a phone call or visit away.