I agree that getting pre-approved is a good starting point, I just want to add that you should contact at least three banks/mortgage companies to compare their interest rates, fees, and customer service. A great financial company will make this whole sale's transaction go much more smoothly.
I can do a FREE Comparative Market Analysis for you to estimate the fair market value. Based on my findings, if you still want to purchase the home, then an appraisal should be ordered by your lender.
I would seek a real estate attorney to draw up the paperwork needed and a title company to handle the transfer of title.
I hope this helps. Remember that it is still a "buyers market", so keep your homebuying options open; there are a lot of fantastic properties out there right now. I know moving is a pain, but if you can find your "castle", then make that move. Please contact me should you decide to look for other properties.