When you first receive the keys to your new home, it can be exciting. And, for most people it’s a relief, because the process to get to this moment has taken months, maybe even years. We know getting a mortgage and buying a home isn’t always easy, with many forms to fill out and decisions to make.
At the CFPB, we are working to make the process of getting a mortgage simpler and easier to understand. Our goal is for you to know before you owe. Part of that work is a new rule that improves disclosure forms; another part is giving you comprehensive and trustworthy resources to guide you through the mortgage process.
That’s why we’ve created “Owning a Home,” a suite of tools and resources on our website. We first launched “Owning a Home” in January 2015. Last week we updated “Owning a Home” with a detailed guide to the mortgage process. Our guide is interactive and easy to use. It offers you clear actions to take and questions to ask every step of the way.
Here’s why “Owning a Home” is the place to come when you want to buy a home.
1. It helps you get prepared financially.
Getting your finances ready for homeownership can be a challenge. “Owning a Home helps you assess your spending and learn how to check your credit. We’ve created a monthly payment worksheet that will help you figure out how much you can spend on a monthly mortgage payment.
2. It helps you shop for a mortgage, not just a home.
Finding your perfect home can be a challenge: would you rather have the home with four bedrooms and a spacious lawn or the home with two bedrooms and a shorter commute? Equally important for you to consider is what kind of loan makes the most sense for your circumstances. You’ll want to start meeting with lenders to explore your options. “Owning a Home” guides you through this process, helps you know what questions to ask when meeting with lenders, and helps you gather the paperwork you’ll need to move forward.
3. It helps you compare loan offers and choose a loan.
After finding the home you want, it’s time to get official Loan Estimates. The Loan Estimate is the form you’ll receive when you apply for most mortgages on or after October 3, 2015. We recommend getting at least three different Loan Estimates and comparing them to find the offer that is best for you and your family. “Owning a Home” features an interactive sample Loan Estimate that helps you double-check the details and get definitions for terms you may not understand.
4. It helps you navigate the process and the paperwork to close with confidence.
Once you choose a loan, you’ll have to provide documentation of your financial information to your lender. You’ll also receive important documents detailing the final terms of your loan. “Owning a Home” has a checklist to help you through the closing process, an interactive sample Closing Disclosure form, and a guide to other key documents you will receive at closing. Review all of your documents in advance of closing so you can ask questions and know before you owe.
5. It helps you every step of the way.
“Owning a Home” helps you through all stages of the mortgage process. It helps you decide if buying a home is the right choice for you now, it helps you understand what you need to do to get a mortgage, it helps you find the best offer, and it helps you close the deal. The unbiased tools and resources help you make smart decisions as you prepare for your future as a homeowner.
The newly updated “Owning a Home” site still includes all of our previously released tools and resources, including our guide to understanding loan options, our tool to help you explore interest rates, and our closing checklist.
If you’re thinking about becoming a homeowner or just curious about what’s involved in getting a mortgage, “Owning a Home” is a great place to come to understand the process and learn how to get started.
This article by Megan Thibos and Maggie Anderson was distributed by the Personal Finance Syndication Network.