Author: Beenish Rida Habib
Introduction Understanding the difference between mortgage prequalification and mortgage preapproval is an important part of the U.S. homebuying process. While the terms are sometimes used interchangeably, they represent distinct steps that involve different levels of financial review and verification. According to the Consumer Financial Protection Bureau (CFPB), both prequalification and preapproval letters may help demonstrate that a buyer is preparing to purchase a home, but the process, documentation, and reliability associated with each can vary significantly. This article provides an educational overview of how mortgage prequalification and preapproval are commonly used in the United States, how they differ, and why…
Introduction Homeowners insurance is a core component of homeownership in the United States. It is often required by mortgage lenders and plays a critical role in protecting one of the largest financial assets most households will ever own. In 2024, direct premiums written for homeowners insurance exceeded $169 billion, reflecting the scale of risk and financial exposure this coverage is designed to address. Despite its importance, many homeowners and buyers are not fully aware of what a standard homeowners insurance policy covers, what it excludes, and how costs vary across regions. This article provides an educational overview of typical U.S.…
Introduction When budgeting for a home purchase in the United States, many buyers focus primarily on the down payment and underestimate closing costs—the additional fees and charges paid at or near settlement. These costs can represent a significant upfront expense beyond the purchase price of the home. According to the Consumer Financial Protection Bureau (CFPB), the median total loan cost for home purchase loans was $5,954 in 2022, reflecting a 22% increase from 2021. The CFPB also reported that 50.2% of borrowers paid discount points, with a median cost of $2,370 when points were used. These figures illustrate that closing…
Introduction Mortgage interest rates are one of the most influential—but often less visible—factors shaping the U.S. housing market. Even when home prices remain relatively stable, changes in mortgage rates can affect estimated monthly payments for new borrowers. These shifts may influence affordability assessments, buyer demand, and overall housing market activity. In the United States, most homebuyers rely on long-term fixed-rate mortgages, making the 30-year fixed mortgage rate a commonly referenced benchmark. According to Freddie Mac’s Primary Mortgage Market Survey (PMMS), the average 30-year fixed rate was 6.06% as of January 15, 2026, compared with 7.04% one year earlier. Changes of…