What is the first step in the homebuying process?

Determining how much you can afford is indeed the first step in the homebuying process. This step is essential because it allows potential buyers to understand their financial limits, including how much they can borrow and what their monthly payments might look like based on their income, debt, and other financial obligations. By assessing their budget, buyers can make informed decisions that align with their financial situation, enabling a more focused approach to searching for a property.

Furthermore, this initial evaluation often dictates the rest of the homebuying journey. Once individuals have a clear understanding of their financial capacity, they can better engage with lenders, set realistic expectations when finding a real estate agent, and narrow down their property searches to homes within their financial reach. This foundational step is critical to avoiding future challenges in the homebuying process.