Step #2. Check Your Credit
Review your credit score and obtain a copy of your credit report early in the loan process. This shows where you stand and helps you qualify for better loan terms. If issues need fixing, address them promptly and work only with reputable credit professionals after doing proper research.
Step #3. Consider ALL Expenses
In addition to your down payment and monthly mortgage, factor in all homeownership costs. Even experienced homeowners often overlook these when downsizing. Budget for closing costs, property taxes, homeowners’ insurance, utilities, maintenance, and any HOA or condo fees, so you have a clear picture of the total cost of your new home.
Step #4. Understand Mortgage Rate Locks
If you’re unsure about the market or concerned that interest rates might rise before closing, it’s wise to lock in a mortgage rate, known as a “mortgage rate lock.” Essentially, this is an agreement between you and your lender that guarantees a specific interest rate on your mortgage for a set period. Mortgage rate locks typically last 30–60 days, though some can extend up to 120 days or more. Short-term locks are usually free, while longer extensions may incur incremental fees. Locking in a rate protects you from rising rates, ensures predictable monthly payments, and can lead to long-term savings, giving you peace of mind as you move forward with your home purchase.
Step #5. Know When to Lock in a Rate
You can’t lock in a mortgage rate until after you’ve been
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