The U.S. Department of Housing and Urban Development (HUD) has put together a step-by-step checklist to help make your home buying process less complicated.
- Figure out how much you can afford - What you can afford depends on your income, credit rating, current monthly expenses, down payment and the interest rate. The calculators below can help, but it is best to visit a lender to find out for sure.
- Know your rights - Review your rights as a borrower and homer owner before you decide to buy a new home. Review HUD's Fair Housing: Equal Opportunity for All brochure, as well as the Real Estate Settlement Procedures Act (RESPA) and Mortgage Borrowers' Rights.
- Shop for a loan - Save money by doing your homework. Talk to several lenders, compare costs and interest rates, negotiate to get a better deal. Consider getting pre-approved for a loan.
- Learn about home buying programs - There may be programs sponsored by your state or local government or other organizations. Or you can check out FHA loan programs that offer lower down payments. These are a good option for first-time home buyers.
- Shop for a home - First, choose a real estate agent that you feel you can trust to help you through the process of finding and purchasing a home. Next, decide whether or not you plan to find a home for sale, build a new home or invest in a fixer-upper, or choose a manufactured (mobile) home. Make a wish list of the features you want, including location, amenities and price range. Also remember that if find a home in a neighborhood with a Home Owners Association (HOA), you should request a copy of the HOA packet to review before closing.
- 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.
- Get a home inspection - Make your 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.
- Shop for homeowners insurance - Lenders require that you have homeowners insurance. Be sure to shop around.
- Sign papers - You're finally ready to go to "settlement" or "closing." Be sure to read everything before you sign!
For more advice on buying a home, check out the Home Buying section of HUD's official site.
