Home Ownership Overview
Home Ownership Resources
If you are still striving for the traditional American Dream of home ownership, learning about the home buying process may be a good first step in the path towards realizing this goal.
First, calculate how much of a house you can afford. Based on a variety of factors, including your income, expenses, credit rating, down payment and the prevailing interest rates, you should be able to calculate the loan amount that a lender may extend to you. The Internet features a plethora of calculators that can help you to figure out how much you can afford. For instance, Ginnie Mae offers a few online homownership calculators: Buy vs. Rent Calculator, Affordability Calculator and Loan Estimator Calculator.
Next, understand your rights. Equal access to homeownership opportunities and rental housing are at the foundation of the United State's federal housing policy. HUD enforces the Fair Housing Act and related federal laws that forbid discrimination and intimidation of individuals in their homes.
The Real Estate Settlement Procedures Act (RESPA), which HUD also enforces, covers settlement procedures and closing costs. RESPA is designed to educate and protect consumers in the home buying process by requiring receipt of disclosures at various steps along the way, and prohibits kickbacks, which can inflate settlement costs.
Third, you should shop around for a loan by talking to a number of lenders. The interest rate and points charged for a loan will generally depend on your credit, the amount borrowed and whether the interest rate is fixed or variable. You will want to think about how long you plan to own the home, your current and future income, and other factors, in determining whether you want a fixed rate loan or variable rate option.
Next, you will need to shop for your new home. Creating a wish list of features you are looking for can help expedite your search. Talk with several real estate agents to understand how they can help you before choosing one. If your new home is part of a Home Owners Association, request a copy of their packet to review the rules.
When you find a home that you like, make the offer contingent on a home inspection so that you do not encounter surprises about the condition of the home after purchase.
Most lenders require homeowners insurance, and it is a good idea to have such a large investment insured so shop and secure homeowners insurance before you close on your home.
Buying a home involved a large amount of paperwork. Be sure to read all the papers before signing. You may want to have an attorney help negotiate the terms of the purchase and review the documents for you.