What we verified in “How to buy a home in the United States, step by step”

Statements and where we checked them

The statements with rules, figures or dates, with the exact place in the source and the date we checked them.

1. The CFPB splits the buying process into four phases: before you make an offer, prepare to shop and explore loan choices; after you make an offer, choose a loan offer and get ready to close. In the third phase it recommends getting official loan offers from lenders, comparing them and choosing the one that is right for you.

   Sources 1 · Buying a house (last modified Jun. 16, 2026): 'Before you make an offer on a home'; '1. Prepare to shop'; '2. Explore loan choices'; 'After you make an offer on a home'; '3. Choosing a loan offer'; '4. Get ready to close'; 'Get official loan offers from lenders, compare your options, and choose the loan offer' · Checked October 17, 2026

2. The CFPB publishes its home loan toolkit in Spanish, 'Su conjunto de herramientas para préstamos hipotecarios: guía paso a paso', with eight steps for choosing a mortgage, a section on closing and one on owning a home.

   Sources 2 · Su conjunto de herramientas para préstamos hipotecarios (CFPB, Spanish PDF): 'Su conjunto de herramientas para préstamos hipotecarios'; 'Guía paso a paso'; 'encontrará ocho pasos para hacer las cosas bien'; 'Entenderá mejor sus costos de cierre' · Checked October 17, 2026

3. The CFPB recommends gathering before you talk to lenders: a pay stub for the last 30 days; W-2 forms for the last two years; a signed federal tax return for the last two years; documentation of other sources of income; the two most recent bank statements; proof of where the down payment comes from, with at least two months of history (and, if part is a gift, a signed statement from the giver saying it was a gift); proof of identity; your Social Security number; and a certificate of housing counseling or home buyer education, if you have one. If you are self-employed or have irregular or nonwage income, you may need additional documentation, and requirements vary from lender to lender.

   Sources 3 · Owning a Home, Create a loan application packet: 'Pay stub for the last 30 days'; 'W-2 forms for the last two years'; 'Signed federal tax return for the last two years'; 'Documentation of other sources of income'; 'Bank statements, two most recent'; 'at least two months’ history of ownership'; 'get a signed statement from the giver stating that it was a gift'; 'Proof of your identity (typically a drivers’ license or non-driver ID)'; 'Social Security number'; 'Certificate of housing counseling or home buyer education, if you have one'; 'If you are self-employed or have irregular or nonwage income, you may need additional documentation'; 'Requirements vary from lender to lender' · Checked October 17, 2026

4. According to the IRS, an ITIN is a 9-digit number the IRS issues if you need a U.S. taxpayer identification number for federal tax purposes but are not eligible for a Social Security number; it is issued for federal tax purposes only; and it does not provide or change immigration status.

   Sources 4 · Individual Taxpayer Identification Number (ITIN): 'An ITIN is a 9-digit number the IRS issues if you need a U.S. taxpayer identification number for federal tax purposes, but you aren’t eligible for a Social Security number (SSN)'; 'An ITIN is issued by the IRS for federal tax purposes only'; 'Provide or change immigration status' · Checked October 17, 2026

5. According to the CFPB, you can get a free copy of your credit report from each of the three major companies (Equifax, Experian and TransUnion) once a week at AnnualCreditReport.com, or by calling (877) 322-8228.

   Sources 5 · How do I get a free copy of my credit reports? (last reviewed Oct 15, 2026): 'once a week at AnnualCreditReport.com'; 'go to AnnualCreditReport.com or call (877) 322-8228' · Checked October 17, 2026

6. According to the CFPB, one sign of a credit repair scam is a company that promises to remove negative information from your credit report even if it is accurate and current, which no one can do; under federal law, all forms of upfront payment before services are completed are illegal; and disputing errors in your credit reports is a free legal right, so you do not need to pay a company to do it for you.

   Sources 6 · How can I tell a credit repair scam from a reputable credit counselor? (last reviewed Nov 7, 2023): 'even if that information is accurate and current. No one can do this'; 'all forms of upfront payment before services are completed are illegal'; 'Disputing errors in your credit reports is a free legal right'; 'You don’t need to pay a credit repair organization to do it for you' · Checked October 17, 2026

7. According to the CFPB, a lender's credit check is recorded as an inquiry, which typically has a small negative effect on your scores; within a 45-day window, multiple credit checks from mortgage lenders count as a single inquiry, so you can get multiple preapprovals and Loan Estimates; checking your own credit does not affect your scores; and it is best to avoid applying for other credit right before or during the mortgage process.

   Sources 7 · What exactly happens when a mortgage lender checks my credit? (last reviewed Aug 28, 2026): 'An inquiry typically has a small negative effect on your credit scores'; 'Within a 45-day window, multiple credit checks from mortgage lenders are recorded on your credit report as a single inquiry'; 'You can shop around and get multiple preapprovals and official Loan Estimates'; 'Checking your own credit does not affect your credit scores'; 'try to avoid applying for these other types of credit right before getting a mortgage or during the mortgage process' · Checked October 17, 2026

8. According to the CFPB, your debt-to-income ratio (DTI) is all your monthly debt payments divided by your gross monthly income; it is one way lenders measure your ability to manage the monthly payments; and different loan products and lenders have different DTI limits.

   Sources 8 · What is a debt-to-income ratio? (last reviewed Aug 28, 2023): 'all your monthly debt payments divided by your gross monthly income'; 'one way lenders measure your ability to manage the monthly payments'; 'Different loan products and lenders will have different DTI limits' · Checked October 17, 2026

9. HUD-approved housing counselors give independent advice on buying, renting, defaults and credit, often at little or no cost.

   Sources 9 · Find a Housing Counselor: 'approved by the U.S. Department of Housing and Urban Development (HUD)'; 'independent advice, often at little or no cost to you' · Checked October 17, 2026

10. According to HUD Handbook 4000.1, an FHA borrower must make a Minimum Required Investment (the minimum down payment) of at least 3.5 percent of the property's Adjusted Value; with a credit score of 580 or higher the borrower is eligible for maximum financing; with a score from 500 to 579 the loan is limited to 90 percent of the value; below 500 the borrower is not eligible; and borrowers with non-traditional or insufficient credit histories are eligible for maximum financing, with manual underwriting.

    Sources 10 · Handbook 4000.1 (update issued August 12, 2026), II.A.2.a: 'must make a Minimum Required Investment (MRI) of at least 3.5 percent of the Adjusted Value'; II.A.1.b.ii: 'at or above 580 eligible for maximum financing'; 'between 500 and 579 limited to a maximum LTV of 90%'; 'The Borrower is not eligible for FHA-insured financing if the MDCS is less than 500'; 'Borrowers with non-traditional or insufficient credit histories are eligible for maximum financing but must be underwritten using the procedures in Manual Underwriting' · Checked October 17, 2026

11. According to the VA, a VA-backed purchase loan often requires no down payment as long as the sales price is not higher than the home's appraised value, and no private mortgage insurance (PMI) or mortgage insurance premiums (MIP); and you must live in the home you buy.

    Sources 11 · VA, Purchase loan: 'No down payment as long as the sales price isn’t higher than the home’s appraised value'; 'No need for private mortgage insurance (PMI) or mortgage insurance premiums (MIP)'; 'You will live in the home you’re buying with the loan' · Checked October 17, 2026

12. According to the CFPB, many states and local organizations offer programs to help first-time buyers with a down payment or closing costs; to find them it suggests looking up a HUD-approved housing counseling agency in your area or calling the HOPE Hotline, 24 hours a day, seven days a week, at (888) 995-4673.

    Sources 12 · Where can I find information on programs for first-time home buyers? (last reviewed Sep 13, 2024): 'Many states and local organizations offer programs to help first-time buyers with a down payment or closing costs'; 'look up a HUD-approved housing counseling agency in your area'; 'HOPE™ Hotline, 24 hours a day, seven days a week, at (888) 995-HOPE (4673)' · Checked October 17, 2026

13. Freddie Mac says you should typically be prepared to pay between 2% and 5% of the home purchase price in closing costs.

    Sources 13 · What Are Closing Costs and How Much Will I Pay?: 'Typically, you should be prepared to pay between 2% and 5% of the home purchase price in closing fees.' · Checked October 17, 2026

14. According to the CFPB, some lenders issue a prequalification letter based on unverified information you report and a preapproval letter only based on verified information; neither is a guaranteed loan offer.

    Sources 14 · What's the difference between a prequalification letter and a preapproval letter?: 'based on unverified information that you report'; 'based on verified information'; 'not guaranteed loan offers' · Checked October 17, 2026

15. According to the CFPB, contact multiple lenders to explore your choices; a preapproval letter shows sellers you are a serious buyer but does not commit you to a lender; and once a seller accepts your offer, you may have as little as a couple of days to line up financing, so shopping for a mortgage beforehand is key.

    Sources 15 · Exploring your loan choices: 'Contact multiple lenders to explore your choices'; 'helps you show sellers that you are a serious buyer–but it doesn't commit you to a lender'; 'you may have as little as a couple days to line up financing' · Checked October 17, 2026

16. According to the CFPB, borrowers who shop around can save thousands of dollars, and different lenders can offer different kinds of loans; and even if a real estate agent or homebuilder has a preferred lender, you can and should shop around for the best deal.

    Sources 16 · Owning a Home, Contact multiple lenders: 'Borrowers who shop around can save thousands of dollars'; 'Different lenders can also offer different kinds of loans'; 'Even if a real estate agent or homebuilder has a preferred lender, still look for a better deal'; 'you can and should shop around' · Checked October 17, 2026

17. According to the CFPB, the Loan Estimate is a three-page form the lender must provide within three business days of receiving your application, and receiving it does not mean the loan is approved.

    Sources 17 · What is a Loan Estimate?: 'three-page form'; 'within three business days of receiving your application'; 'the lender has not yet approved or denied your loan application' · Checked October 17, 2026

18. The Fair Housing Act makes it unlawful to refuse to sell or rent after a bona fide offer, to refuse to negotiate, or otherwise to make unavailable or deny a dwelling to any person because of race, color, religion, sex, familial status or national origin; and also to discriminate in the sale or rental because of a buyer's or renter's handicap.

    Sources 18 · 42 U.S.C. §3604(a): 'To refuse to sell or rent after the making of a bona fide offer'; 'otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin'; (f)(1): 'to any buyer or renter because of a handicap' · Checked October 17, 2026

19. Under the Fair Housing Act, an aggrieved person may file a complaint with the HUD Secretary no later than one year after the alleged discriminatory housing practice occurred or ended.

    Sources 19 · 42 U.S.C. §3610(a)(1)(A)(i): 'not later than one year after an alleged discriminatory housing practice has occurred or terminated, file a complaint with the Secretary' · Checked October 17, 2026

20. According to the CFPB, once you choose a home, schedule an inspection as soon as possible; look for an independent home inspector who is accountable to you; a home inspection is different from an appraisal, but you generally need both; if your purchase contract is contingent on a satisfactory inspection, you have the right to cancel the sale without penalty if you are not satisfied with the results; you can negotiate repairs or a credit with the seller; and inspections are for your protection.

    Sources 20 · Owning a Home, Schedule a home inspection (last modified Dec. 12, 2024): 'schedule a home inspection appointment as soon as possible'; 'You want an independent home inspector who is accountable to you'; 'A home inspection is different than an appraisal, but you generally need both'; 'If your purchase contract is contingent on a satisfactory inspection, you have the right to cancel the sale without penalty'; 'or to give you a credit for the cost of the repairs'; 'Inspections are for your protection' · Checked October 17, 2026

21. According to the CFPB, in the closing phase you also need a home inspection and to shop for homeowner's and title insurance; signing your closing documents is the final step and you should review them carefully; and once you sign, you are responsible for the mortgage loan.

    Sources 21 · Closing on your new home (last modified Nov. 3, 2025): 'You’ll also need to get a home inspection and shop for homeowner’s and title insurance'; 'Signing your closing documents is the final step. Take time to review them carefully.'; 'Once you sign, you’re responsible for the mortgage loan' · Checked October 17, 2026

22. According to the CFPB, an appraisal is a written document that shows an opinion of how much a property is worth; your lender may need a new one and may require you to pay for it; you are entitled to copies of the appraisals your lender gets, no later than three days before closing; and you cannot be charged a fee for the copies.

    Sources 22 · What are appraisals and why do I need to look at them? (last reviewed Sep 4, 2020): 'a written document that shows an opinion of how much a property is worth'; 'may require you to pay for it'; 'you are entitled to receive a copy of appraisals and opinions of value your lender gets'; 'no later than three days before closing'; 'You can’t be charged a fee for copies of an appraisal or other valuation' · Checked October 17, 2026

23. According to the CFPB, most lenders require a lender's title insurance policy, which protects the amount they lend; owner's title insurance protects you if someone sues claiming a right to the home from before you bought it; and you can usually shop for your title insurance provider separately from your mortgage.

    Sources 23 · What is owner's title insurance? (last reviewed Oct 19, 2023): 'Most lenders require you to purchase a lender’s title insurance policy'; 'Owner’s title insurance protects the homeowner'; 'You can usually shop for your title insurance provider separately from your mortgage' · Checked October 17, 2026

24. According to the CFPB, homeowner's insurance pays for losses and damage to your property if something unexpected happens, like a fire or burglary; lenders generally require proof that you have it; standard policies do not cover earthquakes or floods, though that coverage may be added; and you can shop separately and choose your provider.

    Sources 24 · What is homeowner's insurance? Why is homeowner's insurance required? (last reviewed Aug 8, 2024): 'like a fire or burglary'; 'lenders generally require proof that you have homeowner’s insurance'; 'Standard homeowner’s insurance doesn’t cover damage from earthquakes or floods'; 'You can shop separately for homeowner’s insurance' · Checked October 17, 2026

25. According to the CFPB, lenders are required to provide the Closing Disclosure three business days before the scheduled closing.

    Sources 25 · Closing Disclosure Explainer: 'Lenders are required to provide your Closing Disclosure three business days before your scheduled closing' · Checked October 17, 2026

26. According to the CFPB, before you sign, do a final walk-through of the home; you have the right to take your time and review all the documents; you are not committed until you have signed the closing documents and can always walk away, although you might lose any deposit you gave the seller and face other consequences for breaking the contract.

    Sources 26 · Owning a Home, Close the deal (last modified Aug. 21, 2025): 'do a final walk-through of the home'; 'you have the right to take your time and review them all'; 'You are not committed until you have signed the closing documents'; 'You might lose any deposit that you gave the seller' · Checked October 17, 2026

27. According to the CFPB, in the closing scam, scammers send spoofed emails with changed wiring instructions to divert your closing costs and down payment; before wiring money, always confirm instructions with your trusted representatives, by phone at the number you previously agreed to; and never follow instructions contained in an email.

    Sources 27 · Mortgage Closing Scams: 'spoofed emails'; 'Before wiring money, always confirm instructions with your trusted representatives'; 'Never follow instructions contained in an email'; 'the phone number you previously agreed to' · Checked October 17, 2026

28. According to the CFPB, an escrow account is set up by your mortgage lender to pay certain property-related expenses with part of your monthly payment; many lenders require taxes and insurance to be paid through it; your servicer pays those bills on your behalf; and because property taxes and insurance premiums can change from year to year, your escrow payment, and with it your total monthly payment, changes accordingly.

    Sources 28 · What is an escrow or impound account? (last reviewed Sep 11, 2024): 'set up by your mortgage lender to pay certain property-related expenses'; 'Many lenders require that you pay your taxes and insurance using escrow'; 'Your mortgage servicer will manage the escrow account and pay these bills on your behalf'; 'Your property taxes and insurance premiums can change from year to year'; 'your total monthly payment will change accordingly' · Checked October 17, 2026