Top-ranked advisors suggest these key steps when buying a home.

• Buying a home is often the biggest financial decision you'll ever make.
• Some top-ranked advisors offer a step-by-step guide to buying a home.
• Here's what you need to know.

Buying a home is often the biggest financial decision you'll ever make.

Choosing a place to live is not just a short-term decision; it's a long-term investment that will significantly affect your financial future.

To prepare for purchasing a home, it is recommended to follow certain steps, as advised by several experts ranked on CNBC's 2024 Financial Advisor 100 List.

According to Brian Brady, vice president at Obermeyer Wood Investment Counsel in Aspen, Colorado, the key to success is starting with homework and financial planning. The firm ranks No. 23 on the 2024 CNBC FA 100 list.

Stephen Cohn, co-founder and co-president of Sage Financial Group in West Conshohocken, Pennsylvania, emphasized the importance of making a smart financial decision that is tailored to your individual needs. The firm, which ranks No. 61 on the 2024 CNBC FA 100 list, is committed to helping clients achieve their financial goals.

Ron Brock, managing director and chief financial officer at Sheaff Brock Investment Advisors in Indianapolis, Indiana, frequently encounters first-time homebuyers, friends, kids, and acquaintances who become enamored with a house, but their financial situation may not align with their newfound love.

He advises them to be financially savvy and avoid being overly indebted for their home.

If you plan to purchase a home, it's essential to take certain steps into account.

1. Have a strong credit score

Private wealth advisor and partner at Paragon Capital Management in Denver, Colorado, Shaun Williams, stated that the firm ranks No. 38 on the 2024 CNBC FA 100 list.

A higher credit score will result in better loan terms and a lower interest rate, as stated by Ryan D. Dennehy, a financial advisor at California Financial Advisors in San Ramon, California, which ranks No. 13 on the 2024 CNBC FA 100 list.

A FICO score of 620-639 may result in a 7.815% APR, which translates to a monthly mortgage payment of approximately $2,163, according to Bankrate's examples. These calculations are based on national averages for a 30-year fixed mortgage loan of $300,000.

To increase your chances of buying a home, it's recommended to pay off any outstanding debts and refrain from taking on new loans, experts advise.

2. Start saving for the down payment

Putting more money upfront when buying a house can help buyers avoid mortgage insurance costs and potentially lower monthly payments, although a 20% down payment is not necessary.

According to Realtor.com, the average down payment in the third quarter was 14.5%, with a median of $30,300.

To begin saving for a down payment, you must determine your monthly cash flow, which involves tracking your income and expenses, advised Steven LaRosa, director and senior portfolio manager at Edgemoor Investment Advisors in Bethesda, Maryland, a firm that ranks No. 14 on the 2024 CNBC FA 100 list.

LaRosa advised saving as much money as possible towards the down payment.

3. Boost your emergency savings

Williams stated that it's not just the down payment that needs to be accumulated.

An emergency fund should contain six months' worth of expenses, including housing costs, he advised.

To avoid being left with no cash after spending all of your savings on a house's upfront costs, it's important to consider the financial implications of buying a house.

In 2023, households spent an average of $1,667 on home emergency projects, as reported by Angi, an online platform for home improvement professionals.

3. Think about the lifestyle you want

Ask yourself what kind of lifestyle you look forward to, said Brady.

"Do you prefer a condo or a single-family home?" he inquired.

Then you can focus on factors like location and price, said Brady.

The additional costs of owning a house are influenced by the location, including property taxes, utility, and insurance expenses, he stated.

"Getting home insurance is next to impossible, and if you can, it comes at a high cost," said Brady.

5. Factor in other homeownership costs

Owning a home goes far beyond the monthly mortgage payment.

You need to factor in additional costs, experts say.

According to a report by Bankrate.com, the average annual cost of homeownership is $18,118 or $1,510 per month. This includes property taxes, homeowner's insurance, and utility bills. Maintenance costs were estimated at 2% of the home's value per year.

Cohn stated that these additions, although significant, are often overlooked and not given enough importance.

It is advised by experts to have an emergency fund for homeownership costs as costs are unlikely to decrease over time.

6. How long you plan to stay in the house

Cohn stated that we prefer a minimum of five to seven years in a house to allow fixed costs to amortize over time.

Cohn stated that during the initial 5 to 7 years of making mortgage payments, no equity is being gained.