The 8 Steps to Buying Your New Home

Save money & time by working with a professional & avoiding common mistakes

The homebuying process can be broken down into 8 steps which will help you get from the dreaming stage to the closing table. By following these steps and working with your mortgage advisor, you can find the right home for you, at a price you can afford.

Figure out how much you can afford
Know your rights
Shop for a loan
Shop for a home
Make an offer
Get a home inspection
Shop for homeowners insurance
Sign papers

Step 1: Figure out how much you can afford

What you can afford depends on your income, credit rating, current monthly expenses, down-payment and current interest rates. The calculators below can help get you started, but it is best to call you rmortgage advisor to find out all of your options in today’s market.

Use this Ginnie Mae calculator to see how much home can you afford:
Buying vs. Renting
Mortgage Payments Calculator

Step 2: Avoid costly financing traps by knowing your rights

1. You have the RIGHT to shop for the best loan for you and compare the charges of different mortgage brokers and lenders.
2. You have the RIGHT to be informed about the total cost of your loan including the interest rate, points and other fees.
3. You have the RIGHT to ask for a Good Faith Estimate of all loan and settlement charges before you agree to the loan and pay any fees.
4. You have the RIGHT to know what fees are not refundable if you decide to cancel the loan agreement.
5. You have the RIGHT to ask your mortgage broker to explain exactly what the mortgage broker will do for you.
6. You have the RIGHT to know how much the mortgage broker is getting paid by you and the lender for your loan.
7. You have the RIGHT to ask questions about charges and loan terms that you do not understand.
8. You have the RIGHT to a credit decision that is not based on your race, color, religion, national origin, sex, marital status, age, or whether any income is from public assistance.
9. You have the RIGHT to know the reason if your loan was turned down.
10. You have the RIGHT to ask for the HUD settlement costs booklet "Buying Your Home."

Additional Information About Your Rights:
Fair Housing and Equal Opportunity - (brochure)

Real Estate Settlement Procedures Act (RESPA)
The Real Estate Settlement Procedures Act (RESPA) is a federal statute enacted by the U.S. Department of Housing and Urban Development (HUD) to govern the real estate settlement process by mandating all parties fully inform borrowers about all closing costs, lender servicing and escrow account practices, business relationships between closing service providers and other parties to the transaction. The RESPA statute covers mortgage loans on a one-to-four family residential property. These include most purchase loans, assumptions, refinances, property improvement loans, and equity lines of credit. More information about Predatory Lending

Step 3: Shop for a loan

Save money by doing your homework and working with an established professional. Once you have chosen your mortgage advisor, obtain a pre-approval letter that allows you to make a confirmed offer on the porperty of your choice.

HUD brochure: Looking for the best mortgage: shop, compare, and negotiate.

If you haven't chosen a real estate agent, call me for a referral to an agent in your area.
Prepare a wish list that you can discuss with your Realtor. Take the list with you when you are looking at homes so that you can remember your priorities.

Other Options:
Build a home
Land sales
Do's and Don'ts

If you choose a home in a neighborhood with a Home Owners Association (HOA), be sure to request a copy of the HOA packet, so you can review before closing.

Step 5: Make an offer

Discuss the process with your real estate agent. If the seller counters your offer, you may need to negotiate until you both agree to the terms of the sale.

More information on making an offer

Step 6: Get a home inspection

Most homebuyers prefer to make your their offer contingent on a home inspection. An inspection will tell you about the condition of the home, and can help you avoid buying a home that needs major repairs.

Why and how to get a home inspection
10 Questions to ask a home inspector

Step 7: Shop for homeowner's insurance

Lenders require that you have homeowner's insurance. Be sure to shop around to get a competitive rate. Call me for a referral!

Homeowners Insurance
12 ways to lower your homeowners insurance costs

Step 8: Sign papers

You're finally ready to go to "settlement" or "closing."
Be sure to read everything before you sign!

Settlement costs and helpful information