How do I start to Buy a House in Philadelphia?

Do you want your dream to come true and buy a house in Philadelphia? It’s an exciting step, but the process can feel overwhelming if you don’t know where to begin. Do you need a mortgage? Not sure if you qualify? Are you worried about finding the right home in the right neighborhood? You’re not alone—many homebuyers feel the same way.

In this guide, we’ll break down the home-buying process into simple steps, answer common questions, and introduce you to options that can make your journey smoother. Whether you need help with financing, finding the perfect house, or making a strong offer, this article has you covered.

What Do You Need to Buy a House in Philadelphia?

Before you start scrolling through listings or attending open houses, let’s talk about the basics. Buying a home requires preparation—both financially and logistically. Here’s what you need to get started:

1. A Mortgage (Unless You’re Buying in Cash)

Most buyers don’t have hundreds of thousands of dollars in cash sitting around, so they finance their home purchase with a mortgage. This means working with a lender who will assess your financial situation and approve you for a loan.

2. A Good Credit Score

A higher credit score can get you better loan terms, including lower interest rates. If your score isn’t where you want it to be, don’t worry—there are ways to repair your credit.

3. A Down Payment

The down payment is a percentage of the home’s purchase price that you pay upfront. It typically ranges from 3% to 20%, depending on the type of loan you qualify for.

4. Preapproval from a Lender

A mortgage preapproval shows sellers that you’re a serious buyer. It also gives you a better idea of how much house you can afford.

5. A Real Estate Agent

Navigating the Philadelphia housing market on your own can be tough. A local real estate agent can guide you through the process, negotiate on your behalf, and find homes that fit your needs.

Step-by-Step Guide: How to Buy a House in Philadelphia with a Mortgage

Step 1: Determine Your Budget

Before looking at homes, figure out how much you can afford. Consider your monthly income, current debts, and how much you can put monthly for mortgage payments. A common guideline called the 28/36 rule, suggests limiting your mortgage payment to 28% of your gross monthly income and all debt payments to 36%.  While not a strict requirement, it’s a helpful starting point for budgeting. Let’s say your gross monthly income is $5,000. This means your mortgage payment (including principal, interest, property taxes, and homeowner’s insurance) should ideally not exceed $1,400 per month.

Step 2: Save for a Down Payment

Even though some loan programs allow low down payments, having extra savings is always a good idea. It helps with closing costs, moving expenses, and unexpected repairs. Conventional loans usually require a 20% down payment, while with an FHA loan, you will be able to put only 3.5% down.

Step 3: Get Preapproved for a Mortgage

A mortgage preapproval is an official letter from a lender stating how much they’re willing to lend you. This not only helps you set a budget but also makes sellers take your offer more seriously.

Step 4: Choose a Lender

You don’t have to stick with the first lender who preapproves you. Compare different lenders to find the best interest rate and loan terms. It is important that the lender you choose have experience with the type of mortgage you want to get. If you need recommendations, we have strong lender connections and can refer you to trusted professionals.

Step 5: Find a Real Estate Agent

Having a local Philadelphia real estate agent on your side can make a huge difference. They’ll help you find homes in your price range, negotiate the best deal, and guide you through the process. At Philadelphiahouse.com, we connect buyers with top agents who understand the local market.

Step 6: Search for the Right Home

Now comes the fun part—house hunting! Make a list of must-haves, such as location, number of bedrooms, and commute time. Attend showings and open houses to get a feel for what’s available. Your real estate agent has a critical role in this step. Let your agent know what exactly you are looking for. This helps speed up the process!

Researching home values gives you a good understanding of the local market. For example, according to the Philadelphia Inquirer, the median sales price in the Philadelphia metro area in 2025 is $392,230.

Step 7: Make an Offer

Once you’ve found the perfect home, it’s time to submit an offer. Your real estate agent will help you craft a competitive offer that considers market conditions, the home’s condition, and seller motivations.

Step 8: Apply for a Mortgage

After your offer is accepted, you’ll officially apply for a mortgage. Your lender will provide a Loan Estimate, which details the loan amount, interest rate, and estimated closing costs.

Step 9: Home Appraisal and Inspection

An accepted offer isn’t a done deal. You now have time to check the house and make sure it’s worth the price. A home appraisal is a professional assessment of a property’s market value, ensuring the lender does not provide a loan amount exceeding the home’s worth. This step is mandatory for lenders to determine how much they are willing to lend you. On the other hand, a home inspection is a thorough evaluation of the property’s condition, including its structure, plumbing, electrical systems, and other critical components. While a home inspection is not mandatory, it is highly recommended to gain a clear understanding of the property’s condition before finalizing the purchase.

To learn more about the importance of home appraisals and inspections, click here: FHA Appraisal vs. Home Inspection: Complementary Roles in a 203(k) Loan

Step 10: Prepare for Closing

As the closing date approaches, you’ll receive a Closing Disclosure from your lender. This document outlines your final loan terms and costs. Review it carefully to make sure everything matches your Loan Estimate.

Step 11: Final Walkthrough and Closing Day

Before signing the final paperwork, you’ll do a final walkthrough of the home to confirm it’s in the expected condition. Once everything checks out, you’ll close on the home, sign all necessary documents, and receive your keys!

Step 12: Move In and Celebrate!

Congratulations! You officially own a home in Philadelphia. Now it’s time to move in, settle down, and start making it your own.

Not Sure if You Qualify for a Mortgage? Try the Mortgage Ready Program

If you’ve checked your finances and aren’t sure you’ll qualify for a mortgage, don’t give up. Many buyers assume they won’t get approved, but there are programs designed to help.

Mortgage Ready Program can assist buyers who need to build their credit or strengthen their financial profile. Signing up for this program can set you on the right path, even if you’re not quite ready to buy a house in Philadelphia today.

Struggling to Find the Best Home? Matrix and 203(k) Loans Can Help

Philadelphia is a competitive real estate market. If you’re struggling to find the right home, consider a property that needs renovations. With a 203(k) loan, you can buy a house that needs work and finance the cost of repairs—all in one loan.

At Matrix Construction, we specialize in 203(k) renovations, helping homebuyers turn fixer-uppers into dream homes. If you’re open to buying a home that needs updates, this option can give you more choices in a tight market.

Ready to Buy a House in Philadelphia? Let’s Get Started!

Buying a home doesn’t have to be complicated. By following these steps and working with the right professionals, you can buy a house in Philadelphia with confidence. Whether you need help securing a mortgage, finding the right property, or exploring renovation loans, we’re here to help.

Contact us today to take the first step toward homeownership!