Having a place to live is important, and with property prices low across the country, buying one in the United States has become much easier in recent years. However, to buy a house, you need a mortgage. The actual application process is fairly easy, but it’s good to know how it all works before making initial contact with your bank. You’ll need recent bank statements, your social security number, and your income information so your bank can see the type of home loans you qualify for.

The first step is to research different lenders and see what your best mortgage options are. These should include any costs incurred at closing and the interest rate. You can do this by personally contacting all the banks in your area to find the best deals on home loans.

Once you’ve decided on your lender and are happy with your loan, you can move on. Most of your conversations happen over the phone, but when you find out you qualify for a loan, you’ll need to meet at the office where you can provide your physical documentation, so copies can be made for your records. You may also need an application fee, which is used for an appraisal and your credit report. While you are there, you will be asked to sign all of your documents, including your application, Truth in Lending Statement, and Good Faith Estimate. This is when you also lock in your interest rate so you can get the best possible rate. Your lender must give you a prequalification letter so you can pass it on to your real estate agent.

You want to get pre-approved before you start looking at houses so you know exactly how much you can afford. It is now safe to contact a real estate agent who will guide you to housing options that meet your needs within your budget. Once you’ve decided on a home, you’ll sign a purchase agreement and give it to your loan officer.

Some things to remember when buying a home is that you will likely need a fixed amount of equity, which is a bona fide payment that your real estate agent will retain for you and deduct from the final sales price at closing. . Make sure you’re honest about your income, because you don’t want to get home loans you can’t afford. You also shouldn’t open any new accounts while you’re in the credit process and try to pay off any old debts beforehand so they don’t interfere with your home buying process.