Skip Navigation

Branch Locations

Find

Buying a Home

Learn more about the steps to homeownership

Our Hometown Home Loan Program loan officers have helped thousands of people buy their first home. We’ve even been to a fair share of housewarming parties, and are here to help you every step of the way!

1.Become familiar with the homebuying process
Register for a home buyer education class, where you can earn a home buyer education certificate that is required for many first–time home buyers and down payment assistance programs. These classes are often offered through your Hometown Home Loan Program.
2.Choose a lender and get pre–qualified
Make an appointment with your Hometown Home Loan Program loan officer to assess your financial situation. You will need to provide the following items:

  • A list of current debts (copies of current billing statements are best)
  • Current paycheck stubs
  • Verification of funds to close (bank statements, retirement account information, gift deposits, etc.)
When you and your loan officer determine that you are ready to begin your search for a new home, obtain a pre–qualification letter from the loan officer that reflects your ability to qualify for a loan at the amount you wish to pay for a house.
3.Look for a home
It is recommended that first-time home buyers consider using a real estate professional. In addition to helping you search available listings and negotiate the terms of the purchase and sale agreement, an agent can also guide you through the rest of the home buying process and make sure that financing conditions are met in a timely manner. Interview potential agents to make sure you feel comfortable with their methods and that they are familiar with the areas that interest you. Real estate agents can be very helpful in negotiating purchase prices.

 The pre–qualification letter can help strengthen your offer, so be prepared to give a copy to the real estate agent or seller when you make an offer.

 Be aware of program guidelines before making an offer. It is good to inform your real estate agent about the loan program you were pre–qualified for so that they can make sure to include any restrictions in their property search.

 Make an offer and obtain a signed Purchase and Sales Agreement.
4.Have a home inspection
An inspection by a professional home inspector will help turn up any major problems with the property that might be costly to repair.
5.The appraisal
An appraisal is generally done to protect the lending institution's investment in your home. The appraiser will review the condition of the home and find comparable homes in the neighborhood to estimate its value.
6.Closing
Once your loan terms and conditions have been met, the final documents are sent to the escrow office (or whoever is performing the closing of your loan) for the final signing of your loan documents.

 

Budgeting for your future home

For most people, preparing to buy a home can be one of the most important financial endeavors that they will take on. Here are some things you can do to prepare yourself.


1.Get pre-qualified

Getting pre-qualified gives you a snapshot of what you can afford right now so you can start preparing for homeownership. Once you have a realistic idea of what your monthly payment could be or how much you need to save, it’s much easier to set and stick to a budget.


2.Paying off debt while saving for a down payment

Your Hometown Home Loan Program loan officer can help you determine which accounts should be paid off to help you qualify or save for a down payment.


Don’t close out your accounts once you have paid them off. It is important to have a good credit history — showing that you can make payments on time over time, as well as manage debt responsibly by having a few lines of credit open with low balances.


If you have low to moderate debt, put aside more money for your down payment.


Learn more about credit


3.Set a savings goal

Define your savings goal.


Give yourself some time to save the money.


Work out how much money you want to set aside each month.*


*If your new mortgage payment is going to be larger than your existing housing expenses, it’s a good idea to put the amount of the increase into a savings account so you can get used to making the larger payment.


4.Create a budget
Get organized.
Understand your "necessities."
Think before spending.
Design a spending plan and try to eliminate unnecessary spending.
Revise your budget as your needs change.
Keep your eye on the big picture!
Remind yourself — often — why you're saving.
Get your whole family involved.
Stick to your budget as much as possible.
It's okay to splurge a little now and then.
5.Helpful Resources

American Financial Solutions

American Financial Solutions is a nonprofit that partners with HomeStreet Bank as a part of your Hometown Home Loan Program to help you achieve your financial goals.


Online calculators

Personal financial software and online financial planners

Understanding credit

Your credit history — the amount and type of debt you have, plus how you repay it — plays a key role in helping you qualify for a mortgage.


Many first–time buyers are unsure what their credit history reveals and how it affects their ability to qualify for a mortgage. Your Hometown Home Loan Program loan officers are experienced and can walk you through the process of evaluating your credit. Call your Hometown Hotline for a free consultation.


Warning: Beware of agencies offering "quick fixes" or that charge money to clean up your credit report. You can work toward better credit on your own. There is no fast and easy way to improve your credit score. Time, patience and persistence are the keys to improving your score.


How Your Credit Score Is Determined

 

  • Credit history
  • Delinquent accounts
  • Credit card accounts
  • Public records, foreclosures and collection accounts
  • Inquiries

 


As part of your Hometown Home Loan Program, you have access to credit counseling resources in your area. For a list of Hometown-approved nonprofit credit counseling agencies, click here.

Learn more about down payment assistance

Down payment assistance can be a great resource for a first-time homebuyer. Here's what you need to know.


Information about down payment assistance

Many people think that down payment assistance is free money — most of the time it is not. Many down payment assistance programs come in the form of a second mortgage that has a low interest rate or deferred payments. Grants are funds that do not have to be paid back, unless you sell your home within a certain amount of time.


Down payment assistance funds generally come from the federal, state, county or city government to help low- to moderate-income first-time home buyers. Individual banks or employers may also offer grants or other types of programs.


Down payment assistance programs

Down payment assistance programs can usually be used with other programs and seller/realtor contributions, also known as layered financing.


The Hometown Home Loan Program offers many different down payment assistance programs, second mortgages and grants to qualified home buyers. Income restrictions may apply.


Contact your Hometown Hotline to learn more about down payment assistance programs in your area. Program information is subject to change. In some cases, funds are limited.

Loan Programs

Many different types of loan products are available. Your Affinity loan officer will help you determine the best one for you.


Conventional Loan Programs
Government Loan Programs
State Bond Programs
Portfolio Loan Programs
Adjustable Rate Mortgages (ARMs)
Special Loan Programs


Conventional Loan Programs

Almost all lenders and brokers offer conventional loan programs. These can range from fixed loans (30-year, 15-year, 10-year, etc.) to adjustable rate mortgages (5/1 ARM, 3/1 ARM, etc.). When you select a conventional loan program, the loans are "bought" by an investor on the secondary market such as Fannie Mae or Freddie Mac. Because investors buy these loans from lending institutions, they determine the qualifying factors such as credit rating, debt-to-income ratios and interest rates.


Conventional loans with mortgage insurance: Conventional first mortgage loans for more than 80% of the property value (less than 20% down payment) require private mortgage insurance. Mortgage insurance can be obtained on loan amounts up to 97% of the home’s sale price or appraised value.


Please note: Although conventional loan products are "sold" to secondary market investors, the borrowers do not send payments to the investor (known as servicing). Instead, the loans are serviced by the original lender or other lenders who agree to service the loan.


Back to top.


Government Loan Programs (FHA and VA)

FHA loans: FHA loans may be a good option for first-time borrowers. In many cases they allow for a 3.5% down payment, which can come from a variety of sources, including gifted funds. They may have more flexible qualification standards than many conventional loans


VA loans: Available only to qualified military veterans, Veterans Affairs (VA) loans allow for 100% financing.


Back to top.


State Bond Programs

State Bond programs are subsidized by federal funds allotted to each state. They often feature a below-market interest rate and low down payment qualifications.


Back to top.


Portfolio Loan Programs

Portfolio loan programs are offered by specific banks and are not sold on the secondary market or insured by the government. Qualifying guidelines are determined by the originating lender and can be more flexible on income, past employment and credit history than other products. These loans usually have a higher interest rate than other loan products and are serviced only by the originating lender.


Back to top.


Adjustable Rate Mortgages (ARMs)

An adjustable rate mortgage or ARM is a loan program that offers a fixed rate for a determined time period. Introductory rates are often much lower than 30-year fixed rates. When that introductory period of time is up, the interest rate varies with the market conditions.


Back to top.


Special Loan Programs

In addition to the wide variety of standard loan programs, HomeStreet Bank's Affinity Lending Center has special loan programs that may make it easier for Hometown customers to qualify for a mortgage.


Back to top.

Interest rates and fees

Choosing the right interest rate can be confusing, but it is important. Whether you’re a first-time buyer or looking to refinance, you’ve got a lot to consider. We understand. Let us help you find the right interest rate for you. Then let us high-five you in celebration of finding the perfect interest rate.


What are points and fees?
Rebates
Fees
What makes Affinity Lending unique?


What are points and fees?

Points are the upfront charges expressed as a percent of the loan amount. Example: Two points amount to 2% of the loan. Points are related to the interest rate.


Some customers find it useful to pay points to get a lower interest rate. For example: If a lender offers a 30-year conventional loan at 6% and zero points (par), they might charge 1.75 points for a 5.5% loan. The initial upfront cost of buying the interest rate down may be justified when you evaluate the total savings over the life of the loan.


Back to top.


Rebates

Rebates are points refunded to the borrower for taking an interest rate that is higher than par. These points can be used to cover closing costs and fees, and are also known as premium pricing. Rebates are points paid to the borrower (rather than to the lender) for high-rate loans. The lender who charges 1.75 points for a 5.50% loan, for example, might rebate two points for a 7% loan. The two points would be available to cover the borrower's closing costs.


Back to top.


Fees

The origination fee is the amount collected by the lender to cover the costs of making a loan. The fee is used to pay the support staff involved in the loan process. It is typically equal to a percentage of the principal amount borrowed.


The industry-standard origination fee is 1%.


In addition to the origination fee, lenders may also charge fees for processing, document preparation, funding or other miscellaneous expenses. It is important to compare fees listed on the good-faith estimates you request.


Back to top.


How can the Hometown Home Loan Program afford to offer closing cost discounts?

The Hometown Home Loan Program offers eligible Affinity customers 50% off the loan origination fee because our loan officers are noncommissioned. Your Hometown Home Loan Program loan officers quote interest rates closest to par. They do not charge Hometown Home Loan Program customers points for higher interest rates to offer reduced closing costs.


Tip: When reviewing your good-faith estimate, be aware of the interest rate as well as the fees a lender is charging. When choosing a lender, it is important to get good-faith estimates on the same day so you can accurately compare both fees and rates.


Your Hometown Home Loan Program loan officers are available to answer all your questions about buying a home and can help you get started with the pre-approval process. Contact your Hometown Hotline to get started.


Back to top.