Owning a home comes with many advantages. Unlike renting, you can build equity, enjoy steady monthly payments, and have the freedom to update your house to match your style and needs.
Buying a home is exciting, but it can also feel overwhelming. We're here to help make the process easier. If you take it step by step, it won't be as stressful as you might think. Here are five key steps to buying your first home and how Commonwealth Credit Union can support you.
Step 1: Get Pre-Approved
Before you start searching for homes, it's important to get pre-approved for a mortgage. Pre-approval doesn't guarantee a loan, but it helps you see how much you can afford and what kind of loan you might get.
In most areas, sellers want buyers to have a pre-approval letter before considering an offer. This letter usually includes:
- The maximum loan amount you qualify for
- The type of loan
- An estimated interest rate and loan terms (subject to final approval)
A pre-approval letter shows sellers that a lender has checked your income, credit, and finances and decided you are a serious, qualified buyer.
Remember, you don't have to buy a home for the full amount you’re approved for. Pick a home that fits your budget so you can handle payments, cover other expenses, and save for emergencies. If you’re not sure where to begin, try our simple mortgage qualifier calculator to find your best price range.
Step 2: Save for a Down Payment
The down payment you need depends on your loan type, but it’s usually between 3% and 20% of the loan amount. For example, on a $200,000 loan, your down payment would be between $6,000 and $40,000.
These amounts might seem high, but the tips below can help you reach your savings goal.
Cut Unnecessary Expenses
Review your monthly expenses and find places to cut back. For example, make coffee at home, eat out less, or switch to a cheaper phone plan. Small savings add up over time. To help, try our Spend Less Calculator.
Use a Dedicated Saving Account
Think about opening a high-yield savings account or another account just for your home fund. Commonwealth Credit Union offers the First Home Savings Plus plan, which matches 25% of your deposits to help you save for your down payment faster.
Visualize Your Savings
Setting goals is important, but seeing your progress helps too. Our Savings Goals Calculator shows how long it will take to reach your goal if you save a set amount regularly.
Step 3: Find Your Home
Contact a realtor and get ready for the fun part—finding your home. Bring your pre-approval letter and a pen to take notes during tours. Look beyond the number of bedrooms and bathrooms; pay attention to the layout, condition, possible maintenance costs, and location. Use a checklist and take notes on each home to compare your options. This will make your decision easier if you see several homes.
When looking at homes, keep in mind that the price isn’t the only thing that affects what you can afford. The loan term you choose, like a 15-year or 30-year mortgage, also changes your monthly payments and the total interest you’ll pay.
Step 4: Apply for a Mortgage
After you find the right home, the next step is to apply for your mortgage. Even if you’re pre-approved, you’ll need to provide all the documents needed to finalize your loan. Your loan officer will ask for things like:
- Recent pay stubs or proof of income
- W-2 forms or tax returns
- Bank statements
- Details about your debts and assets
- Information about the property you are buying
At Commonwealth Credit Union, we aim to make the mortgage process simple and clear. With great rates, flexible terms, and a focus on our members, we want your path to homeownership to feel as comfortable as your new home.
Step 5: Closing and Moving Day
You’ve found your home and secured your loan. Now comes the most exciting part—closing day! This is when everything becomes official, and you finally get the keys to your new home.
At closing, you’ll review and sign the final documents to make your purchase official. This includes your mortgage agreement, title papers, and any last disclosures from your lender. You’ll also pay closing costs and fees, like appraisal fees, property taxes, or homeowners’ insurance. Once everything is signed and processed, the money goes to the seller, and you get the keys to your new home.
Congratulations—you’re officially a homeowner!
Let CommonWealth Credit Union Take the Homebuying Steps with You
At Commonwealth Credit Union, we’re more than just your lender—we’re your hometown partner. From pre-approval to closing, we’re here to support you with personal service, great rates, and advice you can trust. Wherever life takes you, we’ll help make your financial journey as rewarding as your new home. Call us today and let’s take the first step together.
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