Keys to My Home FAQs
I want to become a homeowner, but I don’t know where to start. What are the first steps I should take?
A great way to start is to talk with a homeownership counselor at a NeighborWorks organization in your community or an agency approved by the U.S. Department of Housing and Urban Development. Many of these organizations offer free workshops for prospective homeowners. These workshops offer an excellent opportunity to learn about the process of homeownership.
Before you start looking at homes, decide if you are better off owning or renting. If you are better off owning, then check your credit rating and, if necessary, fix any errors and take steps to improve it. Then you are ready to choose a homebuying team, including your real estate agent.
I checked my credit report, and found several errors. And, unfortunately, some of my late payments from the past showed up as well. What can I do to repair and improve my credit?
Review the Understanding Your Credit section of this Web site to learn how to fix errors in your credit report and how to repair your credit.
How much house can I afford?
Here is a rough guideline: Most people who have good credit and steady income and do not owe a lot of money can afford to buy a home that costs two-and-a-half to three times their annual income. For example, a family earning $30,000 a year, with monthly credit card payments and car payments of less than $200 (about 8 percent of their income) and a good credit rating will probably qualify for a loan to buy a house that costs between $75,000 and $90,000.
How do I get a mortgage loan?
Because houses are so expensive, most people need a loan to buy one. This type of loan is called a mortgage. Getting a mortgage for such a large amount of money is more complicated than applying for a credit card or borrowing money for a car. See the Finance Your Home section to learn how to shop for a loan.