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The Home Buying Process

Congratulations! You have decided to explore homeownership and we're here to guide you through every step to help make your dream a reality.

Step 1

Determine eligibility

Whether you are looking at a VA, USDA, FHA or conventional loan, find out what you need to ensure your eligibility for a home loan through one of these special finance programs.

  • VA loans

    A Certificate of Eligibility (COE) will prove that you meet the eligibility requirements for a VA home loan with the Department of Veterans Affairs. There are government forms to gather as well as a statement of military service. A COE can be obtained online through the VA benefits website and Freedom Mortgage can help you with all the details.

  • USDA loans

    You need to ensure your property is located in an eligible rural area. Check out the USDA government website to help you determine if your location qualifies. USDA loans also have income limits that vary by location and household size. This map will help determine your eligibility.

  • FHA loans

    To be eligible for an FHA loan you need at least 3.5% down payment. Plus, there are income requirements to ensure you can cover your monthly debts including your new loan.

  • Conventional loans

    Conventional loans require a higher credit score and down payment requirement. However, more properties are eligible for conventional loan financing such as second homes or investment properties.

  • Your credit score

    Your credit score is based on several factors, including how much debt you have, your credit history and whether or not you pay your bills on time. Your credit score can affect whether or not you'll meet the requirements for a VA loan.VA loans can be more forgiving than conventional loans when it comes to credit scores. 

    You are eligible for a free annual credit report through www.annualcreditreport.com. Read through it carefully and make sure there are no mistakes. If there are any errors, follow the information provided to correct any accounts so that your score is as accurate as possible. If you have already received your free credit report, you can still get another, you'll simply need to pay a small fee to receive another copy to know where you stand.

    You may want to avoid opening a new credit card account, buying a car or making any other large expense when applying for your home loan, as that could change your credit and may affect your eligibility.

Step 2

Get pre-approved

Freedom Mortgage can help you with considerations on your home budget and how much you may be able to borrow. We will ask you information about your specific financial situation, check your credit and verify your income and assets. Once this is completed, we can give you a written pre-approval. A pre-approval is a valuable document as it tells sellers and real estate agents how much you can put toward a down payment and the mortgage you are qualified for which will be needed for submitting an offer on a home.

 

Get a basic estimate with our mortgage affordability calculator.

Step 3

Search for your home

Find a trusted real estate agent who is familiar with the area you are looking at and start searching with your Freedom Mortgage approval in hand. It's also a good idea if you are interested in pursuing a special loan program such as VA, FHA or USDA, to use an agent who is familiar with these types of loans so they will be able to conduct a more targeted search within the guidelines of the program.

Here are some more considerations when looking for a new home:

  • point 1Check out the school system. You can go online to the state Department of Education and see details such as test scores, graduation rate and college acceptance.
  • point 2Investigate the safety of the neighborhood. Read the local newspaper to see if there's been any issues and drive through the area at various times of the day to get a sense of the safety.
  • point 3Take a tour. See how far it is to access hospitals, shopping, schools, and recreation areas.
  • point 4There are many tools online but you will want to explore and even walk the local neighborhood to ensure the house and location meets your needs.
 

Once you select a property, make an offer and negotiate with the seller on a final sale price.

Step 4

Get a home inspection

If you are working with a real estate agent, they may recommend service providers for a home inspection and other certifications. You will be given a list of services that need to be done in order to close on your loan.

  • point 2A home inspector checks over the house and looks for any problems affecting the safety or resale value of the property; if this occurs, you may want to negotiate with the seller to make required repairs.

Step 5

Close on your loan & move in

The final step in any real estate transaction is the closing, so make sure everything is in place before you get to that exciting day. One of the biggest risks to closing on time is a change in a borrower's financial circumstance. You may want to avoid opening a new credit card account, buying a car or making any other large purchase prior to closing.

  • point 1Government-issued photo ID for borrower and co-borrower
  • point 2Funds necessary for closing costs (typically a cashier's check; not a personal check)
  • point 3Binder for homeowners' insurance (hazard insurance) and paid receipt
  • point 4There may be other items as well but we will walk you through everything you will need

 

Although closing may only take an hour, consider setting aside extra time as there are many documents to sign. Your closing agent will explain what you are signing and you will have the opportunity to ask questions.

 

The borrower and any co-borrowers attend the closing in person. A closing agent (also called a settlement agent or escrow agent), the title company representative, the seller, any real estate agents involved and an attorney may also be present.
 

Once your closing is complete, you're ready to start moving in. You'll feel great when you get your keys to the door of your new home. 

Congratulations on this exciting milestone!