How to Buy a Home in California: Step by Step, From Budget to Keys

Buying a home in California follows the same order whether you are shopping in Irvine or anywhere else in the state: set a budget, get pre-approved, sign a written agreement with a buyer's agent, search and tour, write an offer with contingencies, work through escrow, and close when the deed records. Once your offer is accepted, a financed purchase commonly takes about 30 days to close.

What makes California different is the paperwork around those steps. State law requires a written buyer representation agreement, the standard purchase contract gives you set windows to investigate and cancel, sellers owe you a long list of disclosures, and a neutral escrow holder, not attorneys, usually runs the closing.

Here is each step of how to buy a home in California, in order, with what to do, what it costs and where Orange County buyers most often get surprised. This is general information, not legal advice; for questions about a specific contract, talk with a California real estate attorney.

The steps at a glance

1. Set a budget around the full monthly cost, not the loan approval.
2. Get pre-approved by a lender that verifies your income, assets and credit.
3. Sign a buyer representation agreement with your agent.
4. Search, tour and check the costs that come with each home.
5. Write an offer with a deposit and contingencies.
6. Open escrow, inspect, review disclosures and remove contingencies.
7. Review your Closing Disclosure, do the final walkthrough and close.
8. After closing, file for the homeowners' exemption and watch for supplemental tax bills.

Step 1: Set a budget you can live with

Lenders approve you based on ratios of debt to income. You should buy based on the full monthly cost of the specific home, which in Orange County can differ a lot between two homes at the same price.

Your monthly cost includes:

• Principal and interest on the loan.
• Property taxes. Under Proposition 13 the general levy is 1% of assessed value, and the assessed value resets to roughly your purchase price when you buy. Voter-approved charges come on top, and some newer communities add Mello-Roos special taxes.
• Homeowners insurance, which has become harder to find and more expensive in parts of California. Quotes vary by address, so get one before you commit to a home.
• HOA dues for condos, townhomes and many planned communities.
• Mortgage insurance on FHA loans, and on conventional loans with less than 20% down.

Upfront, plan for the down payment, closing costs and cash left over afterward. Minimum down payments depend on the loan. Eligible VA borrowers may need nothing down. FHA allows 3.5% down with a credit score of 580 or higher. Some conventional loans allow 3% down for qualifying buyers, though generally not the larger "high-balance" loans common in Orange County.

Closing costs depend on your loan and on what the contract says. Our guide to Orange County closing costs breaks down who customarily pays what. Leave room for repairs and moving as well; a budget that only works if nothing breaks in the first year is too tight.

Step 2: Get pre-approved, not just prequalified

Talk to a lender before you tour seriously. The Consumer Financial Protection Bureau (CFPB) notes that lenders use "prequalification" and "preapproval" differently, and that neither letter is a guaranteed loan offer. What matters is whether the lender has verified your information. Ask for a pre-approval based on documents, not just on figures you reported.

Expect to provide:

• Recent pay stubs and W-2s, or two years of tax returns if you are self-employed
• Bank and investment statements for the funds you will use
• Information about your debts, and permission to pull your credit
• Details on any gift funds, which lenders document separately

Once you apply, the lender must give you a Loan Estimate within three business days. Every lender uses the same form, so you can compare rates, fees and cash to close side by side. Getting more than one is the easiest way to see whether a quote is competitive.

This is also when you choose a loan type: fixed or adjustable, conventional, FHA, VA or jumbo. Loan size matters in Orange County. For 2026, the Federal Housing Finance Agency (FHFA) set the county's one-unit conforming loan limit at $1,249,125; larger loans are jumbo loans with lender-set standards. Our guide to California home loans compares the options.

After pre-approval, ask your lender before you open new credit, change jobs or move large sums. Any of those can change your approval mid-escrow.

Step 3: Sign a buyer representation agreement

Since January 1, 2025, California law has required a buyer's agent to have a written agreement with you "as soon as practicable," and no later than when you sign an offer. According to the California Department of Real Estate (DRE), it must state the agent's compensation, the services provided and when payment is due, and it can last no more than three months from signing. Agents covered by the National Association of REALTORS® settlement rules also need a written agreement before touring a home with you, in person or by live video.

Compensation is not set by law and is negotiable. You can ask a seller to pay some or all of your agent's fee as part of your offer, and the seller can accept or decline. Before you sign, read the term, how either side can cancel, and whether the agreement covers any home you buy during the term or only homes the agent was involved with. Our guide to California buyer agreements walks through each paragraph.

You do not need an agreement to walk into an open house on your own or to ask an agent questions.

Step 4: Search, tour and look past the listing photos

Set up your search around the things you cannot change later: location, commute, lot, layout and type of ownership, whether a single-family home, a condo, a townhome or a home in a planned community with an HOA. Tour in person when you can, at different times of day.

For each serious contender, check the costs and constraints that photos do not show:

• HOA documents and dues. In a condo or planned development, the budget, reserves, rules and any pending special assessments affect both cost and financing. FHA and VA buyers also need the condo project to meet that agency's approval rules.
• Special taxes. Mello-Roos and other assessments appear on the property tax bill. Ask for the current bill before you offer.
• Insurance. Ask an insurance agent or broker to quote the specific address. Homes in high fire hazard areas can be harder to insure.
• Age and condition. Roof, plumbing, the electrical panel, and permits for additions, garage conversions or an ADU.
• Commute and daily routine. Drive the commute at rush hour. Confirm which school district serves an address with the district itself, since attendance boundaries can change.

Step 5: Write an offer that protects you

Most California offers are written on the California Association of REALTORS® (C.A.R.) Residential Purchase Agreement. Your agent prepares it with you. It sets the price, your deposit, your financing, the closing date and the contingencies that let you cancel if something goes wrong.

Under the form's default terms:

• Your initial deposit goes to escrow within 3 business days of acceptance.
• The seller has 7 days to deliver required disclosures and reports.
• Your investigation, loan, appraisal and insurance contingencies each run 17 days.

Each of those periods is negotiable. A shorter contingency can make an offer stronger, but only if you can actually finish your inspections, appraisal and loan approval in time. If both sides initial the liquidated damages clause, the most a seller can keep if you default on a one-to-four-unit home you plan to live in is 3% of the price.

Price is only part of a competitive offer. A verified pre-approval, a meaningful deposit, a closing date that suits the seller and clean terms all count. If the seller counters, the back-and-forth continues until one side signs the other's final version and delivers it back. That moment is acceptance, and the contract clock starts the next day.

Step 6: Escrow, inspections and contingency removal

Once your offer is accepted, escrow opens. Escrow is a neutral party that holds money and documents and follows written instructions from both sides. Our California escrow timeline walks through a 30-day escrow day by day.

During the contingency period, you:

• Wire your deposit after confirming the instructions by phone with escrow, at a number you got from a trusted source. Treat any emailed change to wiring instructions as fraud until you confirm it by phone.
• Review the seller's disclosures, including the Transfer Disclosure Statement and Natural Hazard Disclosure, along with the preliminary title report and any HOA documents.
• Inspect. A general home inspection, plus specialists as needed, such as a sewer scope or a roof or chimney inspection. Our guide to California home inspections covers what each one finds and how to ask for repairs or credits.
• Line up insurance and send the policy information to your lender.
• Complete the appraisal and loan approval.

Contingencies do not expire on their own. You remove them in writing once you are satisfied, or cancel in writing while they are still in place. After you remove one, you generally cannot cancel for that reason without putting your deposit at risk, so do not remove a contingency until you have what it protects, such as inspection reports, the appraisal, an insurance quote or written loan approval.

Step 7: Closing Disclosure, final walkthrough and closing

Your lender must give you the Closing Disclosure at least three business days before you close on the loan. Compare it line by line with your Loan Estimate: interest rate, monthly payment, closing costs and cash to close.

Shortly before closing, you sign loan and escrow documents in front of a notary and send the rest of your funds to escrow, confirming the wiring instructions by phone again. The final walkthrough, which the C.A.R. form schedules 5 days before closing by default, confirms the home is in the agreed condition and that agreed repairs were completed. It is a check on condition, not a new chance to cancel.

The lender funds the loan, the title company records the deed with the Orange County Clerk-Recorder, and escrow closes. Under the standard contract, you take possession when recording is confirmed, unless your contract sets a different time or the seller is renting the home back.

Step 8: After you get the keys

Two property tax items catch new owners off guard:

• Supplemental tax bills. Your purchase triggers a reassessment. The difference between the prior owner's assessed value and yours arrives as one or two supplemental bills, separate from the regular bill. If your loan has an impound account, ask your lender whether it will pay them or whether you should.
• The homeowners' exemption. The Orange County Assessor mails new owners a pre-filled claim form. If the home is your principal residence, the exemption removes $7,000 from its taxable value. Filing by February 15 gets the full exemption; a claim filed by December 10 may receive 80%.

Keep your closing documents, final settlement statement and records of any improvements. You will want them when you refinance, and they help establish your cost basis when you sell.

How Remark Homes can help

Remark Homes is a veteran-owned brokerage based in Tustin, serving Irvine and all of Orange County. When we represent you, we help you set a realistic budget with your lender, review the costs and documents on each home before you offer, write terms that fit your timeline, and track every escrow deadline through closing. When you are ready, you can review and e-sign our California buyer agreement on our Get Started page; nothing is binding until you sign.

Frequently asked questions

How long does it take to buy a house in California?

Preparation takes as long as you need to save, get pre-approved and find the right home. Once an offer is accepted, a financed escrow commonly runs about 30 days, and a cash purchase can close faster.

How much do I need for a down payment in California?

It depends on the loan. Eligible VA borrowers may put nothing down, FHA allows 3.5% down with a credit score of 580 or higher, and some conventional loans allow 3%. You also need cash for closing costs.

Do I have to sign a buyer agreement to tour homes?

To have an agent tour homes with you, generally yes. You can visit an open house on your own without signing anything.

Who pays closing costs when you buy a house in California?

Both sides pay some. The purchase agreement decides, with local custom filling gaps. In Orange County the buyer usually pays the loan-related costs, and the seller usually pays the owner's title policy and the county transfer tax.

Can I back out after my offer is accepted?

Yes, while a contingency is still in place, by cancelling within its terms. Once you have removed your contingencies, backing out can cost you your deposit.

Sources

• CFPB: What's the difference between a prequalification letter and a preapproval letter?
• CFPB: What is a Loan Estimate?
• CFPB: What is a Closing Disclosure?
• California DRE: Consumer alert on changes to real estate representation
• FHFA: Conforming loan limits for 2026, by county
• Orange County Assessor: Homeowners' Exemption