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2016 Home Buying and Selling Guide

With the Fed's first rate increase behind us, and with refinances slowly grinding to a halt, the 2016 housing market can concentrate on buyers and sellers.

But while there still may be some anxiety about how higher rates will affect the market as the year progresses, current rates are historically low, and even when the Fed raises rates again, rates should remain historically low.

For yet another year, limited housing inventory will play an important role as sellers continue to be cautious about listing homes for sale. This limited inventory will put pressure on home prices and is bound to make multiple-offer situations quite prevalent.

Here is a quick guide to help buyers and sellers navigate the mortgage and real estate market in 2016.

Table of Contents

No. 1: Home buyer programs by state | 2016

HSH.com has compiled a list of home-buying-assistance programs in each state in order to inform borrowers of what assistance might be available to them in their local area.

Each state offers a different number of programs, and each state offers varying levels of buyer assistance. For this project, HSH.com only collected information on programs that were available statewide. While targeting first-time home buyers, we did not exclude programs available to repeat buyers as well.

To qualify for one of these statewide home buyer assistance programs, which can offer anything from below-market mortgage rates, to down-payment assistance, to special programs for police and firefighters, borrowers must almost always attend a home buyer education course. Statewide assistance programs must be acquired through a participating lender.

No. 2: 12 things I learned when buying my first home

Believe it or not, you could be like our own Managing Editor, up to your eyeballs everyday in mortgage and real estate information and still be surprised and humbled by the home-buying process.

Start to finish, how long does buying a home take? Are you prepared for a multiple-offer situation? Is a home inspection your one-stop shop to learning everything about your home? Are you prepared to pay for your closing costs?

Find out the answers to these questions and more.

No. 3: 3 reasons a mortgage prequalification isn't enough to buy a home

Homebuyers are often told they need to prequalify for a mortgage. That's good advice, up to a point; a prequalification is only a baby step toward getting a loan. What's better -- by far -- is being not just prequalified, but preapproved.

It's no wonder buyers confuse these two terms -- even lenders use them in different ways to mean different things. The important point is that a preapproval outranks a prequalification.

No. 4: World's most confusing mortgage terms

Do you know the difference between a conforming loan and a non-conforming loan? Is conforming and conventional the same thing? And what’s the difference between private mortgage insurance and just plain mortgage insurance?

If you think mortgage jargon is confusing, you're not alone. And it's not only novice homebuyers who are stumped. Some of these terms are so tricky even the experts don't agree about exactly what they mean.

We’ve documented a list of some of the world’s most confusing mortgage terms.

No. 5: Homebuyer education courses: A secret weapon for first-time buyers

A lack of savings for a down payment, credit problems, or uncertainty about the home-buying process -- such as where to find the best mortgage lender -- can all make it seem impossible to go from renter to homeowner.

Fortunately, though, there's a secret weapon that can help you surmount all these hurdles. That secret is taking a homebuyer education course, a move that has huge financial and practical benefits.

"Buying a home is a huge decision and a long term commitment," says Keosha Burns, spokesperson for Fannie Mae in Washington, D.C. "When new homebuyers complete pre-purchase homebuyer education they can be better prepared for what to expect during the purchase transaction as well as the ongoing responsibilities of homeownership."

Housing counseling can save you thousands of dollars and help you get a home sooner rather than later. So if you're thinking of buying a home in the not-too-distant future, here's what you need to know about homebuyer education courses.

No. 6: Live here, work there: Best places to live outside the big city

To commute, or not to commute?

It’s no secret that it’s ideal for people to live where they work. And with the number of jobs in central cities growing in the post-recession era, HSH.com sought to determine whether it’s best to live where you work.

When it comes to the decision between living in a central city or in one of the surrounding suburbs, the differences can be financial, educational, and related to personal security.

HSH.com looked at 17 cities and their surrounding areas to measure the trade-offs between living in or just outside those cities. In some cases, a short move outside the big city can make a big difference. In others, working and living in the city center makes the most sense.

In each of the following slides, a central city will be listed, followed by the surrounding areas with scores showing the average percentage by which conditions there are better or worse than in the central city. However general the differences cited by this study may be, the intention is for them to highlight potential situations where a short move can have a big impact. This might give you some ideas about where you might want to start packing your bags, and where you might be happier staying put.

Current Mortgage Rates

About the HSH Mortgage Pricing Survey »
Loan This Week Last Week
30-year Fixed *
3.59 3.54
15-year Fixed *
2.99 2.94
5/1-year ARM
2.91 2.86
* Conforming, Expanded Conforming, and Jumbo Rates.
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