8 Steps to Buying a House in Georgia

Kristen Klempert


Kristen Klempert

May 26th, 2021
Updated May 26th, 2021


8 Steps to Buying a House in Georgia

Buying a house is exciting, but it's by no means easy. Everything from the local economy to your financials to the housing market in Georgia will impact what home you buy and how much it costs.

The more you know about the steps to buying a house and the current real estate trends in Georgia, the better you’ll be able to navigate your choices.

Key takeaways for buyers in Georgia
  • Seller's market: Buyer demand exceeds how many homes are listed right now. Most homes are going off market quickly.
  • Property values are increasing: Over the next year, homes in Georgia will appreciate by 7.6%.
  • Mortgage rates are low: In Georgia, mortgage rates average 2.38% for a 15-year mortgage and 2.94% for a 30-year mortgage.

If you're on the hunt for your dream home, finding the right agent makes all the difference. Clever offers a free service that matches you with local realtors from top companies like Berkshire Hathaway and Keller Williams.

The best part? When you buy with Clever, you could earn a cash-back refund worth up to 0.5% of the home price. On a qualifying $500,000 purchase, you'd get $2,500. That's real money back in your pocket!

» SAVE: Buy with a top local agent, save thousands with Clever Cash Back

Step 1: Evaluate your financial situation

If you're planning to take out a mortgage to pay for your home, you need to understand how your financial situation impacts your buying options.

We'll go into more detail below, but here are the financial factors you need to have in good shape before buying a house:

Key Takeaways: Financial Requirements
  • Credit score: While there are low-credit loans, you'll need a score of at least 620 for most conventional loans. If your credit score is lower than that, start working to raise your credit score now.
  • Debt-to-income ratio: In most cases, you'll want to spend less than 36% of your income on debt (including your future mortgage payment) each month.
  • Down payment: For a conventional loan, you'll need a down payment of at least 20%.
  • Closing costs: Home buyers typically have to pay 2-5% of the home's price in closing costs. Considering the average home value in Georgia is $216,314, that amounts to $4,326-10,816. These costs usually have to be paid out of pocket, so make sure you have savings to cover them.
  • Homeownership costs: In Georgia, homeowners typically spend $2,331 in maintenance costs annually, but this can vary widely based on the house. In general, you should save 1% of the house's value each year for repairs.

Future mortgage payment

The first step to getting your finances in order is determining how much you can afford to spend on your mortgage each month.

When deciding whether to approve your mortgage, most lenders follow the 28/36 rule:

  • Total housing costs (including your future mortgage) shouldn’t exceed 28% of your monthly income
  • Total monthly debt payments shouldn’t be more than 36% of your monthly income (this number is called your debt-to-income ratio)

So, let's use the median monthly income in Georgia, which is $4,896 (based on Census data), as an example to calculate a potential mortgage payment.

$4,896 x 28% = $1,371

Debt-to-income ratio

Mortgage lenders want to know you'll be able to afford monthly payments. To do this, they look at what your debt-to-income ratio (DTI) would be after taking on a mortgage.

The higher your debt-to-income ratio, the less likely you are to be approved for a mortgage; however, most lenders are more forgiving if you have a high credit score. While some lenders will approve mortgages for borrowers with a DTI as high as 43%, in most cases, it's best to keep your DTI under 36%.

To calculate your DTI, add up all of your recurring monthly debt payments, plus your estimated mortgage payment, and divide it by your gross monthly income (before taxes).

When figuring out how much you pay each month in debt, don't forget to include:

  • Minimum credit card payments
  • Student loans
  • Auto loans
  • Alimony or child support
  • Personal loans
  • An estimate of your mortgage payment

Let's look at a few examples, using the average amount of debt in Georgia, to see how to calculate debt-to-income ratio.

How to calculate your debt-to-income ratio

Type of Debt
Monthly Payment
Credit Cards
Student Loans
Auto Loans
Total Monthly Debt
Monthly payments based on data from Chamber of Commerce, LendEDU, and AutoWise (car payment for a used car)

Given that the median monthly income in Georgia is $4,896, a typical DTI in the state is 43%.

$2,120 ÷ $4,896 = 43%

Keep in mind your DTI will impact what type of mortgage you can apply for. In most cases, a conventional loan requires an after-mortgage DTI under 36%, a VA loan under 41%, and an FHA loan under 43%. While these rules aren't set in stone, if your DTI is higher than these benchmarks, you will face more scrutiny during the underwriting process.

Don't forget your other expenses!

When assessing your mortgage eligibility, lenders don’t include non-debt costs like groceries, health insurance, utilities, or your retirement savings, but it’s still a good idea for you to plan for those expenses!

Consider how much of your monthly income goes towards these costs and make sure there's still enough left over to cover a mortgage payment.

Down payment

Down payments are a way for lenders to offset their risk. By making a down payment, you put “skin in the game.”

For example, if you put $20,000 down to purchase a home, you have a strong incentive to not default on your mortgage since you’d be giving up that $20,000 if the bank foreclosed on your home!

For a conventional loan, you'll need a down payment of around 20%.

Government-backed loans, like VA and FHA loans, have lower down payment amounts because they use other means to offset potential risk.

For instance, veterans can qualify for a VA loan with no down payment but must pay a one-time VA funding fee. FHA loans require down payments as low as 3.5%, but the borrower must also pay for private mortgage insurance (PMI) throughout the term of the loan.

In Georgia, the median home value is $216,314. Using that as an example, here's how much you'll need to save for a down payment:

Mortgage Type
Down Payment
Down Payment
VA Loan
FHA Loan
Conventional Loan
Based on home value data from Zillow (October 31, 2020)

Need help saving up for a down payment?

Luckily, across the country, there are thousands of down payment assistance programs to help first-time or low-income buyers afford a house. In most cases, these programs are either governmental grants or second mortgages with deferred or forgiven payments.

Here are some details on down payment assistance programs in Georgia:
  • The Georgia Dream Homeownership Program offers a grant for first-time home buyers and those buying in certain counties
  • By first contributing $1,000 of your own money, you can get up to $5,000 towards your down payment
  • If you have a qualifying disability or work in certain key “PEN” occupations, you can get $7,500, and if you are eligible under the Hardest Hit Fund, you can get $15,000
  • Eligibility may vary based on income and purchase prices
  • HUD’s list of alternative programs can be found here.

Closing costs

Legally closing a real estate transaction involves many services (title searches, document recording, etc.) that cost money.

The seller is responsible for some closing costs, but typically, the buyer pays the majority of these expenses out of pocket. A buyer's closing costs usually run between 2-5% of the loan amount and include costs like:

  • Appraisal fees
  • Inspections
  • Loan application fees
  • Property taxes
  • Title insurance policies and fees
  • Homeowner's insurance

» LEARN Georgia Closing Costs for Buyers

Quick Tip: Buy with Clever and get money back!

When you buy a home with Clever, you can receive Clever Cash to help offset buying expenses. Qualified buyers get 0.5% back on homes over $150,000 after closing.

Plus, you'll work with a top agent in your area who will help you find the perfect home and get you the best deal.

finances for buying a home

Step 2: Choose the right neighborhood

A house's neighborhood is just as important as its layout and features. In general, you'll need to consider the following factors to decide which area is best for you:

Key Takeaways: Neighborhood factors
  • Home values: Looking at the average home values of a neighborhood will help you see if you can afford to live there. Historical trends in property appreciation will also show you if buying in the area will pay off in the future.
  • Local lifestyle: A neighborhood can impact everything in your life from your daily commute to your kids' school to where you go out to eat.

Home values

After Step No. 1, you should have a good idea of your home buying budget. Do some research on current sale prices in different neighborhoods to start narrowing down your options so you don't end up looking at houses that are out of your price range.

Also, look at past home value trends; this will give you an idea of how much your home's value can appreciate over the years. You want a neighborhood that's in your budget, but can also lead to a big return when you decide to sell.

To give you an idea of how appreciation could impact what your house is worth in the future, let's look at some examples of how homes in three neighborhoods in Atlanta have appreciated over the years.

Home value appreciation in Atlanta

2010 Home Value
2020 Home Value
Appreciation Rate
North Buckhead
Old Fourth Ward
Based on home value data from Zillow (October 31, 2020)

Local lifestyle

Once you have a list of neighborhoods you can afford and that are a good investment, you'll need to evaluate how well each area meets your personal needs and preferences.

To finalize your list of target areas, look into neighborhood features like:

  • School districts
  • Restaurants and amenities
  • Crime rates
  • Walkability
  • Transportation options

Step 3: Find a great real estate agent in Georgia

A local real estate agent will be your main ally during the home buying process. Aside from finding and showing you houses, they can also make recommendations for other services like lawyers, lenders, and escrow companies. And once you find a house, it's your realtor who will make sure you get a great deal.

Quick Tip: Clever can match you with the right agent for you!

Depending on where you live, there can be thousands of buyer's agents in your area, making it overwhelming to find the perfect realtor. Luckily, Clever's concierge team can match you with hand-picked, local agents who will meet your needs.

Our network of vetted agents have proven track records with home buyers in your area and will get you a great deal on your dream home.

Take the time to research different agents who are experienced in your desired part of town and price range. Pay attention to realtors’:

  • Years of experience
  • Number of transactions in the last year (the more the better)
  • Experience in your price range and chosen neighborhood
  • Overall review score
  • Individual reviews and complaints

Once you have a list of 3-5 potential agents, schedule times to interview them to see if they'd be a good fit. Ask them questions about the neighborhood you're looking at (school system, trends in property values, any planned developments) to see if they have the knowledge and experience to help you make an educated decision.

Also, know that you can go to showings with an agent (or more than one) before signing a buyer's agency agreement. This is common and lets you go for a "test drive" with a realtor to see how well they meet your needs before committing to working with them.

finding a buyers agent

Step 4: Get pre-approved for a mortgage

Most sellers won't show you their home unless you have a mortgage pre-approval letter. They don't want to waste their time with buyers who aren't serious or financially ready to put in an offer.

Getting pre-approved for a mortgage gives you and the seller confidence that if they accept your offer, you'll be able to get financing and close the deal.

Compare interest rates

While there's a wide range of mortgage terms, most conventional mortgages are for 15, 20, or 30 years. With a shorter term mortgage, you'll have a lower interest rate, but a higher monthly payment.

Let's see how the numbers break down for loans of different terms for a home worth Georgia's median home value of $216,314 (assuming a 20% down payment).

15-Year Mortgage vs. 30-Year Mortgage

15-Year Mortgage
30-Year Mortgage
Loan Amount
Interest Rate
Monthly Payment
Based on home value data from Zillow (October 31, 2020) and interest rates from Bankrate.com (Dec. 10, 2020)

Choose a Lender

Aside from interest rates and mortgage terms, you'll also want to find a lender who actively works with you to ensure the deal closes.

If the lender's underwriting process is slow, or if they take forever to give you all the necessary paperwork, it can derail your entire transaction.

Don’t let a bad lender derail your home buying journey.

The best way to get a lower interest rate is by shopping around. Even if you’re already pre-approved, it pays to get several quotes on rates and fees. A few percentage points can mean hundreds of thousands of dollars over the life of your loan.

Learn how much home you can really afford to kick off your home buying journey.

Maintain your credit

Once you're pre-approved for a mortgage, it's imperative that your financial situation doesn't change. If your credit drops, it can derail the process and keep you from closing on your house.

Here are some easy ways to ensure your credit doesn't change after you receive your pre-approval letter:

  • Avoid opening new credit accounts
  • Don't close any accounts that have been open for a long time
  • Make all of your credit card payments on time

how to maintain your credit

Step 5: Start house hunting in Georgia

Tips: house hunting during COVID-19
  • Whenever possible, view homes through virtual tours to narrow down your options.
  • Always ask the showing agents what protocols are in place to keep you safe during showings.
  • Ask about remote closing options early so you can avoid contact with others as much as possible during the transaction.

Viewing homes is the fun part of buying a house! But don't forget, eventually you'll have to make the big decision about which one is right for you.

Here are some of the most important factors to remember when looking at different homes:

Key Takeaways: House hunting tips
  • "Must haves" vs. "nice to haves": No home is perfect. As you view homes, you'll have to decide which of your priorities are non-negotiable and which are just nice bonuses.
  • Understand current housing inventory: Depending on the time of year you're looking for a home, you might have fewer options to choose from. If there are fewer houses on the market, you might have to adjust your expectations.

Make a list of priorities

Start by writing out a list of everything you want in a home. Rank each item based on how important it is to you. This will help you begin to separate your "must haves" from your "nice to haves."

Then have a discussion with your agent about whether your list is realistic. They know what homes in your price range and target neighborhood are like and can point out where you might have to make concessions.

Trust your agent. As long as they stick to your price range, they can show you a variety of properties and might even surprise you with a house you wouldn't have considered without them.

Look at current housing inventory

When you start house hunting can impact your number of options. For example, in Georgia, April is when there are historically the most homes on the market. While in November, there are almost 39% fewer homes available.

If you're viewing homes in a time of low inventory, you might have to be less picky before choosing a home to bid on.

Housing inventory in Georgia by season

Average No. of Houses on the Market
171,795 houses per month
139,728 houses per month
113,922 houses per month
114,677 houses per month
Based on 2020 data from Realtor.com

Step 6: Make offers

Once you find a house you love, it's time to make an offer and convince the seller to sell to you. But if you don't know when to make an offer or how to make it more attractive, the seller might not accept it.

Key Takeaways: Making offers
  • Move fast: Know how quickly homes are going off the market so you don't wait too long to make an offer. In Georgia, homes are currently spending an average of 49 days on market before receiving an offer. If your dream house has been listed about that long, you shouldn't wait to submit an offer.
  • Know how to sweeten the deal: Sometimes a higher price isn't your best option for getting a seller to accept your offer. You can write in different asks — like no contingencies — to create a deal that works for you and the seller.

How long you have to make an offer

Currently, in Georgia, homes typically stay on the market for 49 days. But every market goes through seasonal changes. During some months, homes get snatched up more quickly than in others.

Depending on when you're house hunting, you might have to make an offer sooner than you'd expect — especially if homes spend fewer days on market than the annual average.

Looking at the table below, historically, you'll need to move fastest in October when homes only stay on the market for 49 days. But if you're looking to buy in January, you have more time to make your decision since houses typically spend 25 days longer on market than the annual average.

When in doubt, talk to your agent. They can let you know how quickly you need to put in an offer for your dream house.

Average time homes spend on market in Georgia

Annual Average
57 days
74 days
66 days
55 days
57 days
62 days
61 days
56 days
51 days
49 days
49 days
51 days
72 days
Based on 2020 data from Realtor.com

Writing the perfect offer

Price isn't the only thing that can influence a seller to accept your offer. You can make other compromises, based on the state of your market, to sweeten the deal for you and the seller.

writing an offer pros

Here are some common negotiating opportunities to work out a win-win deal with the seller:

  • Seller concessions: As the buyer, you'll have to pay for most of your closing costs out of pocket. To save on these upfront costs, you can ask for seller concessions. Instead of lowering your offer price to have more money on hand, the seller pays for your closing cost and the expenses are essentially rolled into your mortgage.
  • Repair credits: If the home is in need of repair, you could ask for credits instead of having the seller make and pay for the repairs. The seller avoids the hassle of waiting for contractors to complete the job, and you get to oversee the repairs in the future to make sure they meet your expectations.
  • Inspection contingencies: Most purchase agreements have inspection contingencies that allow you to change your offer (or back out all together) if the inspection turns up major problems. If you have a high degree of certainty about the house's condition (like if the seller can show you a recent inspection report), you can forgo this contingency to give the seller a higher sense of confidence.
  • Letter to the seller: Many sellers have a personal attachment to the home. They've lived there for years and want to know the next owner will take care of the property. Writing a letter to the seller can show them how you picture your life in the house and appeal to their sentimental side.

Step 7: Inspections and appraisals

Once a seller accepts your offer, there are a series of due diligence steps that ensure the home you’re buying is exactly what you signed up for. After inspections and appraisals, you'll have a chance to go back to the negotiating table if something unexpected pops up.

Key Takeaways: Inspections vs. Appraisals
  • Inspections: A licensed professional checks the house for any unseen, unexpected, or potential issues.
  • Appraisals: An appraiser hired by your lender will examine the house and determine how much it is worth.


Inspections give you peace of mind about the condition of the property. You should always hire a licensed inspector and make sure they check out the following parts of the property:

  • Roof
  • Foundation
  • Electrical system
  • HVAC system
  • Plumbing

If the home has a septic system, it's also a good idea to pay for a septic inspection that scopes out the system with cameras to look for any potential issues.

Georgia Specific Inspections

Aside from a general inspection, Georgia also recommends buyers have the following inspections and testing done before closing on a home:
  • Radon Testing: While Georgia law doesn't require radon testing, it's highly recommended, especially in counties with higher radon levels like Cobb, DeKalb, Gwinnett, and Fulton.
  • Termite Inspection: If you're applying for a VA loan, you'll most likely be required to have a termite and pest inspection in Georgia. Most lenders will also ask for a letter certifying the home has recently been inspected for termites.


Unlike an inspection, an appraisal isn't strictly about the condition of the home; it's about its value. If you're taking out a mortgage, your lender will require an appraisal to ensure the house is worth the amount of money they're giving you.

inspections and appraisals

» LEARN: 3 Options for Buyers After a Low Appraisal

Step 8: Final walkthrough and closing!

When it's time to close, you'll be able to do a final walkthrough of the property to ensure it's still in the expected condition. While you might be excited for the buying process to be over, stay focused so you don't miss anything.

During the walkthrough, be sure to run through the following checklist:

  • Inspect the ceilings, walls, and floors for cracks, chipped or peeling paint, or other imperfections
  • Test every light switch and electrical outlet
  • Run the water to look for leaks and check the pressure and temperature
  • Flush all toilets
  • Make sure you have working keys for all the doors (don't forget any garage door openers or smart lock technology)
  • Test any appliances that are included in the sale
  • Check the heating and air conditioning system
  • Open and close all windows while checking that they lock and there are no unexpected drafts
  • Make sure all trash or belongings from the previous owners have been removed

On closing day, be prepared to sign a ton of paperwork. Your agent (or your lawyer) should explain every document before closing, but still ask any remaining questions you have before signing.

Hiring a Real Estate Lawyer

In Georgia, it's required for a real estate attorney to be part of every home sale. While your agent can make recommendations, remember you get to make the final decision. Interview lawyers before hiring them to make sure they have the experience you need.

Key takeaways of buying a house in Georgia

The 8 Steps to Buying a House
  • Get your finances in order. You'll need a solid credit score and debt-to-income ratio, an appropriate down payment, and enough savings to cover closing costs and homeownership expenses.
  • Decide what neighborhood is right for you. Find an area that fits your lifestyle and is a good investment for the future.
  • Partner with the right real estate agent. A great agent will have experience in your area and price range. They'll also be able to help you throughout the home buying process.
  • Get pre-approved. Most sellers won't show their home to buyers who aren't pre-approved. Do your research and find a lender that offers the best interest rates and terms and that will ensure the deal closes.
  • Go house hunting. Compare your options and make sure you understand your local market and what its condition means for your choices.
  • Make a strong offer. Price isn't the only factor sellers consider. Talk with your realtor so you can make a competitive offer that benefits you and the seller.
  • Prepare for inspections and appraisals. Inspections and appraisals give you and your lender peace of mind about the purchase, but be prepared for more negotiating if anything unexpected comes up.
  • Do a final walkthrough and close. Take the time to check the entire house closely. Once you officially close on the house, it's all yours!

Buying a house is an involved and time-consuming process, but it doesn't have to be overwhelming. If you know what steps to prepare for and have the right agent by your side, you'll find the perfect home in your price range.

Find the right agent for you.

Clever can match you with a local agent who has the experience you need.

Additional resources for home buyers in Georgia

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