FHA Loans for Homebuyers
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FHA Refinancing
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Need to Know
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FHA Programs for Homebuyers
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FHA Support: Step 8
Sign On The Dotted Lines
You are now ready to officially buy your new home. With the help of a qualified Realtor, you found a home you were
interested in. You consulted an FHA lender, either before or after locating your dream home, to figure out how much money
you could borrow. If you qualified for an FHA loan, you got a great deal.
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Now is the time for an
FHA HOME LOAN
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The next step is to sign an agreement of sale with the seller. The final step is called "settlement" or "closing," where the
legal title to the property is transferred to you. Here is a quick guide to the steps and costs of closing. Keep in mind that
if you applied for and received an FHA loan, some of these closing costs may have been reduced.
Items Payable in Connection with an FHA Loan
Loan Origination: Sometimes called a "point" or "points" it covers the lender's administrative costs in
processing the loan.
Loan Discount: Also often called "points" or "discount points," this is a one-time charge imposed by the
lender or broker to lower the rate at which the lender or broker would otherwise offer the loan to you.
Appraisal Fee: Pays for an appraisal report made by an appraiser.
Credit Report Fee: Covers the cost of a report which shows your credit history.
Lender's Inspection Fee: Covers inspections, often of newly constructed housing, made by employees of your
lender or by an outside inspector.
Mortgage Insurance Application Fee: Covers processing your application for mortgage insurance.
Assumption Fee: Charged when a buyer "assumes" or takes over the duty to pay the seller's existing mortgage loan.
Mortgage Broker Fee: Fees paid to mortgage brokers.
Sales/Broker's Commission: Total dollar amount of the real estate broker's sales commission, usually paid by the seller.
Items Required by Lender to be Paid in Advance
You may be required to prepay certain items at the time of settlement, such as accrued interest, mortgage insurance
premiums and hazard insurance premiums.
Interest: Lenders usually require borrowers to pay the interest that accrues from the date of settlement to the
first monthly payment.
Mortgage Insurance Premium: The lender may require you to pay your first year's mortgage insurance premium or a lump sum
premium that covers the life of the loan, in advance, at the settlement.
Hazard Insurance Premium: Hazard insurance protects you and the lender against loss due to fire, windstorm,
and natural hazards. Lenders often require the borrower to bring to the settlement a paid-up first year's policy or to
pay for the first year's premium at settlement.
Flood Insurance: If the lender requires flood insurance, it is usually listed here.
Escrow Account Deposits: Payment of taxes and/or insurance and other items that must be made at settlement to set up
an escrow account.
Title Charges: For a variety of services performed by title companies and others.
Settlement or Closing Fee: Paid to the settlement agent or escrow holder.
Title Search, Title Examination, Title Insurance Binder: The costs of the title search and examination.
Document Preparation: some lenders or title companies have a charge to cover their costs of preparation of final legal
papers such as a mortgage, deed of trust, note or deed.
Notary Fee: This fee is charged for the cost of having a person who is licensed as a notary public swear that
the persons named in the documents did, in fact, sign them.
Attorney's Fees: For legal services provided to the lender, such as an examination of the title binder. The cost of
your attorney and/or the seller's attorney may also appear here.
Title Insurance: The total cost of owner's and lender's title insurance.
Government Recording and Transfer Charges: Fees for legally recording the new deed and mortgage, Transfer taxes, which
in some localities are collected whenever property changes hands or a mortgage loan is made are set by state and/or
local governments. City, county and/or state tax stamps may have to be purchased as well.
Additional Settlement Charges
Survey: The lender may require that a surveyor conduct a property survey.
Pest and Other Inspections: Inspections for termites or other pest.
Lead-Based Paint Inspections: Inspections or evaluations for lead-based paint hazard risk assessments.
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to Buying a Home with an FHA Loan
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> FHA Step 1
How much can you afford?
> FHA Step 2
FHA says, "Know your rights."
> FHA Step 3
Shop for an FHA loan.
> FHA Step 4
Shop for a place to call home.
> FHA Step 5
Make an offer for the home.
> FHA Step 6
Get a home inspection.
> FHA Step 7
Your homeowners insurance.
> FHA Step 8
Sign on the dotted line and move in.
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Receive cash back and save money when you buy or sell your home.
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Get a VA loan to buy a home, to build a home, to refinance your mortgage, or to simultaneously purchase and improve a home.
VA Mortgage News
Browse through articles about
VA home loan programs,
VA benefits, home buying and selling,
VA mortgage shopping
and insurance.
Pioneer Military Loans
Serving the military community with personal loans from $500 to $10k.
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