Buying your first home
What to look for in a mortgage.
During April 2016, 619,000 single-family homes were sold in the United States according to the U.S. Census Bureau and the Department of Housing and Urban Development. Buying your first home can be a terrifying, yet exciting time. Michigan State University Extension’s Starting over after Foreclosure Toolkit contains a Homebuyer’s Wish List, House Hunting Checklist, and Neighborhood Checklist of all which can assist you in finding your dream home. Educating yourself before beginning the home buying process can help alleviate some of the terrors
When looking for a mortgage lender, it is important to do your research. The Federal Trade Commission (FTC) offers the following tips on shopping for a mortgage.
- Obtain information from several lenders - thrift institutions, commercial banks, mortgage companies, and credit unions all offer mortgage products but mortgage fees will vary so it is important to shop around for the best deal.
- Obtain all important cost information – When shopping around it is important to understand what interest rate you qualify for, if any points are tied to the interest rate, fees (i.e. closing cost, appraisal, title insurance, inspection, etc.), and the down payment or mortgage insurance. The FTC Mortgage Shopping Worksheet is a great tool to take with you when shopping for your mortgage lender to record basic information.
- Obtain the best deal that you can – Once you have shopped around, compared the cost, and negotiated terms of your loan, then lock in your mortgage loan interest rate.
Additionally, it’s always a good idea to review your credit report for accuracy and completeness before you apply for a loan. You are entitled to one free credit report per bureau (Experian, Equifax, and Trans Union) every 12 months. To order a free copy of your credit report, visit www.annualcreditreport.com or call (877) 322-8228.
Michigan State University Extension offers financial literacy and homeownership workshops throughout the year to help you become financially healthy and learn more about the home buying process. For more information about classes in your area, go to either the events website or MI Money Health website. Take the Financial Health Survey at MI Money Health to access if you’re financially healthy and discover more ways you can improve your financial health.