SoFi

Are you thinking about hunting for a home or already hitting the open houses? If so, creating a home-buying wish list can help you identify what you need, what you want, what to avoid, and other key factors in your decision of whether to bid on a property or not.

By getting these thoughts down on paper (or an online document), you can better focus your house hunting and have a guide as you navigate this process.

Here, you’ll learn more about creating a home-buying wish list template and zooming in on the right property for you. It will also help you steer clear of falling for a house that can wind up being a bad fit as time passes.

What Is a Home-Buying Wish List?

A home-buying wish list is a simple template that can help you identify and prioritize the features you are looking for in a home. It gives you a method to evaluate whether a property is one to bid on or one to pass on.

For example, a wish list can help you zero in on the price you want to pay, the community you want to be in, the style and size of the home, the acreage of the property and outdoor features, and other variables.

By having a wish list, you can stay on target. Say you fell in love with a charming farmhouse with shutters and perfect window boxes full of flowers, but no ground-floor bathroom (or room to add one) and a roof in need of repair. If your wish list said, “Must have a ground-floor bathroom” and “Roof in good repair,” you would (ideally) be able to say no to the home’s curb appeal and keep searching. That way, you may well avoid having buyer’s regret.

Benefits of a Home-Buying Wish List

A home-buying wish list has several pros:

•  Creating a wish list gives you the opportunity to consider your needs and wants in a home. It also will help you prioritize the features that you most want in a property.

•  A wish list can help you stay on budget. If you know that you absolutely must have a spa-style bathroom or a chef’s kitchen, you need to stay focused on finding a home that offers that feature or else have money set aside to renovate to your specifications.

•  By developing a wish list, you and your partner or family member you are house shopping with can align on priorities.

•  You can better understand trade-offs involved in a home purchase. For instance, if you are determined to buy in an area with a hot housing market or a pricey school district, you may only be able to afford a smaller property than you might like.

Recommended: First-Time Homebuyer Programs

How to Create a Home-Buying Wish List

If you’re ready to dive in, follow these steps to develop your wish list.

First, Daydream a Little

After you’ve closed your eyes and thought about it, write down everything you saw in the vision.

Before writing down all your wants on a home-buying wish list, sit back and fantasize a little about what an ideal home looks like. This dream house will look different to everyone, but after you’ve closed your eyes and thought about it for a while, you should write down everything you saw in the vision.

Is there a big yard and open space (or even a pool), or is it in the center of town where all the action is? Do you gravitate toward a mid-century modern home or a center-hall colonial? Does the dream home come with a big eat-in kitchen, or are lots of bedrooms more important? Is there space for a game room? An outdoor spa? A wraparound deck or a balcony overlooking it all?

It’s your dream. Go ahead and dream about home size, home age, and home style. That way, you can better realize what you really want (and want to steer clear of) in a home. Start writing down your wish list.


💡 Quick Tip: With SoFi, it takes just minutes to view your rate for a home loan online.

Whittle Down the Dream List

After spending some time thinking about what a dream home would look like if money were no object and jotting down notes, you might then start crossing things off your list.

Realistically, maybe you don’t need five bedrooms but can live with three instead, and maybe the basement doesn’t need to be finished just yet. Or, perhaps a kitchen remodel can come with lower-end appliances that look like commercial ones but come with a more manageable price tag.

Bring that daydream list down to reality before beginning the search.

Consider Who You’re Buying With, Too

Before going out to buy a home, whether you’re a first-time homebuyer or old hand, it’s important to think about who’s going to live there. Is it just for one? A couple? A whole family?

It would be best to get everyone’s input on wants vs. needs to ensure that all will be satisfied with this monumental life and financial decision. You might want to sit down as a group and consider the following.

•  Setting: It may also be a good idea to get granular about your location. For instance, a potential homebuyer who has a dog may want to consider a neighborhood that has good walkability and sidewalks.

A potential buyer who works from home may want to think about how close a coffee shop is so they can pop over for a snack. Websites like Walk Score can help people discover how close cafes, shops, restaurants, grocery stores, and public transportation are to their new address.

•  The right school district: If you’re buying a new home with family members in mind, it’s important to consider every home’s school district. Websites like GreatSchools provide information on school district rankings. All users need to do is pop in the ZIP code.

Even if a homebuyer isn’t thinking about having children, school districts still may play a role in their home-buying decision. That’s because a school district can play a major part in a home’s resale value.

It may be a good idea to also draw up a neighborhood wish list.

💡 Quick Tip: To see a house in person, particularly in a tight or expensive market, you may need to show proof of prequalification to the real estate agent. With SoFi’s online application, it can take just minutes to get prequalified.

Home-Buying Wish List Template

Need some inspo for creating a home-buying wish list? Check out the Alabama Housing Finance Authority’s Home-Buying Wish List .

You can then customize it and drill down on the features that really matter to you. For instance, if you have school-age kids, you might add a line for after-school care programs; are they offered or not?

If you know you will be tight on cash for renovations, then you might get more specific about the age of key home systems, such as the HVAC, the major appliances, the roof, and so forth.

Recommended: What Do You Need to Buy a House?

Questions to Ask While Home Shopping

In addition to the usual features of a home, here are a few additional points to consider:

•  Are you in an area that is prone to natural disasters? Would you, say, need flood insurance, and how much would it cost?

•  Have any additions been made to the home? If so, was the paperwork (permits and such) properly filed?

•  What are the typical monthly utility costs for the home? This may help you get a ballpark number that can help you assess your home-buying budget.

•  Is there an HOA? If so, what costs are involved, and what rules are enforced?

The Takeaway

Creating a home-buying wish list helps to identify wants and needs, what is in the budget, and what everyone involved—spouse, children, pets, guests, an elder parent—can live with happily (if not ever after, for a while). Home style, size, neighborhood, and amenities all come into play.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

How do I make a house wish list?

A good place to start is with the Alabama Housing Finance Authority’s checklist. You can then customize the wishlist to better suit your areas of focus, such as school districts and programs, or, say, acreage and outdoor features.

How do I get my house ready to sell with a checklist?

Many home-buying sites and mortgage lenders offer downloadable checklists that help you get your house in order to sell. These typically review how to assess and enhance the exterior of your home, your property, as well as the interior. Usually, they go room by room with features for you to note and maintenance issues to potentially wrangle.

What is a house-buying must-have?

Something that you won’t be able to live in a new home without is a must-have. Things like electricity, heating, and plumbing are no-brainers. But must-haves can also include other items that are non-negotiable for you, which could mean good nearby schools, great light, or multiple walk-in closets.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

SOHL-Q225-170

Personal loans are borrowed lump sums that you pay back, with interest, to the lender. Though the money can be used for almost anything, some common uses for personal loans include covering medical bills, paying for home repairs, and consolidating debt.

When you don’t have the savings to cover an important purchase or bill, a personal loan is usually a better alternative to credit cards. Here, take a closer look at what personal loans can be used for, their drawbacks and benefits, and alternative ways to pay for unexpected expenses.

What Can I Use a Personal Loan For?

Personal loans may be used for just about anything “personal,” meaning it’s not a business-related expense. Here are some of the most popular reasons people take out different types of personal loans.

Debt Management and Consolidation

Refinancing or high-interest debt consolidation into better loan terms is one of the most common uses for a personal loan — and one of the most financially savvy. Credit card debt carries some of the highest interest rates out there. Credit cards also typically have variable rates, making it challenging to create a predictable budget to pay down outstanding debt.

Rates for personal loans, on the other hand, tend to be lower than credit card APRs. This can save borrowers a lot of money in interest over the long term. And the fixed payback schedule of a personal installment loan may help borrowers avoid falling into a vicious cycle of revolving debt that can continue indefinitely.

You don’t have to be drowning in credit card debt to benefit from consolidation. For borrowers with multiple loans, consolidating debt with one personal loan can be a useful financial tactic — if the borrower qualifies for good loan terms.

Bottom line: Personal loans can help streamline multiple high-interest debt payments into one payment. Plus, debt consolidation loans tend to have lower rates than credit cards. This could help borrowers save money in interest over time.

Recommended: Where to Get a Personal Loan

Wedding Expenses

The average cost of a wedding in 2025 can range from $10,000 to over $30,000. Unfortunately, many young couples have not saved up enough to pay for their entire wedding themselves. (In many cases, the days when a bride’s parents footed the entire wedding bill are over.)

A personal loan, sometimes referred to as a wedding loan when used for this purpose, can cover some or all of a well-budgeted wedding. Personal loans tend to offer much lower interest rates than credit cards, which some newlyweds may use to fund their big day.

However, before you go this route, think long and hard about whether you really want to start out your married life in debt. Consider if you can actually afford to pay off the loan in a timely manner. If not, it might be better to cut back on your wedding budget, or take more time to save up for the big day.

Bottom line: A wedding loan can help pay for some or all of the wedding costs, which could help you avoid having to use a credit card or tap into your savings.

Unexpected Medical Expenses

When a medical emergency occurs, it’s important for your main focus to be on a healthy outcome. But the financial burden can’t be ignored. Being able to pay for out-of-pocket expenses with a low-rate personal loan may relieve some stress and give you time to heal.

It’s no secret that the cost of medical care in America can be sky-high, especially for the large portion of Americans who have high-deductible health plans. The situation is even more challenging for those who don’t have health insurance coverage at all. According to data from the Kaiser Foundation, about 6% of Americans carry at least $1,000 in medical debt.

Bottom line: Medical emergencies happen. Using a personal loan to help pay for bills and expenses could provide peace of mind.

Recommended: How to Pay for Medical Bills You Can’t Afford

Moving Expenses

A low-interest personal loan (also known as a relocation loan) may help defray some out-of-pocket costs associated with moving. A local move can set you back $1,500 on average. Moving 1,000 miles or more typically costs more than $3,000.

And these figures only account for the move itself. As anyone who has relocated knows, hidden costs can and do often pop up, from boxes and storage space to cleaning fees and lost security deposits.

There are also expenses that come with a new home. Most new rentals require upfront cash for a deposit, sometimes totaling three times the monthly rent (first, last, and security). Opening new utility accounts may also require a deposit.

And don’t forget about replacing household items left behind. Even basics like soap, light bulbs, shower curtains, and ketchup can easily total a few hundred dollars.

Lastly, miscellaneous costs can arise during the move itself, such as replacing broken items. Even with insurance, there’s usually a deductible to pay.

Bottom line: Whether you’re relocating across town or across the country, expenses can pile up quickly. A relocation loan can help you pay to move and set up your new home.

Funeral Expenses

Many people have life insurance to cover their own funeral. But what if Mom, Dad, or Grandpa didn’t plan ahead? If the deceased did not plan appropriately to finance their death, and life insurance doesn’t cover the bill, a personal loan can be a quick, easy solution for the family.

Basic costs for a funeral include the service, burial or cremation, and a memorial gathering of friends and family. The median cost of a funeral service with a viewing and burial is $8,300, while the cost of a funeral with cremation is $6,280.

Bottom line: When a loved one passes away, paying for the funeral may be the last thing on your mind. If you need help financing the arrangements, a personal loan could provide a fast and simple solution.

Home Improvement Expenses

Many renters and homeowners feel that annual or biannual itch to spruce up their living space. That might mean a fresh coat of paint, upgraded appliances, or a kitchen remodel. Depending on the level of your project, the cost of home remodel can come in anywhere from a few hundred to tens of thousands of dollars.

If you’re making upgrades that will improve a home’s value, the cost may be made up when selling the house later. Using a personal home improvement loan can help you focus on the renovation instead of fretting about costs. Plus, if you get an unsecured loan, you won’t have to worry about putting your home equity on the line as collateral.

Bottom line: Taking out a home improvement loan is one way to help fund a home improvement project.

Family Planning

Whether your plans involve pregnancy, adoption, in vitro fertilization (IVF), or surrogacy, growing a family can be expensive.

The average cost of a complete IVF cycle, for example, can be between $12,000 and $25,000, and multiple cycles may be required. Also, insurance may or may not cover some of all of the costs.

Once your baby arrives, you’ll need money to pay for diapers, clothing, formula, and other supplies. A personal loan can help you cover the expenses without having to dip into your savings or emergency fund.

Bottom line: When you’re looking to add a new member to the family, a personal loan can provide peace-of-mind financing.

Car Repairs

You get a flat tire. The transmission fails. The brakes go out. When your car breaks, chances are you can’t afford to wait to have it fixed while you pull together the necessary funds. A personal loan can help you cover the cost of the repair, which can be significant.

On average, consumers spend around $1,160 per year maintaining their cars in 2025, and major repairs can run much higher than that.

Bottom line: Car repairs are rarely planned. If you need money quickly to fix your car, you may want to consider a personal loan. Depending on the lender, you may be able to get same-day funding, but it could also take up to one week to get the money.

Vacation

Ready to take the plunge and book that bucket list trip? A vacation loan is one way to help finance your travel, and the interest rate could be lower than a credit card’s.

Bottom line: If you’re planning an expensive getaway and don’t have the cash you need at the ready, a personal loan can help you pay for the trip. Note that you may be paying off the loan long after the trip.

What Personal Loans Can’t Be Used For

While personal loans can be used for almost anything, there are some restrictions. In general, here are things you should not use a personal loan for:

•   A down payment on a home. Buying a home? In general, you’re not allowed to use personal loans for down payments on conventional home loans and FHA loans.

•   College tuition. Most lenders won’t allow you to use personal loans to pay college tuition and fees, and many prohibit you from using the money to pay down student loans.

•   Business expenses. Typically, you are not allowed to use personal loan funds to cover business expenses.

•   Investing. Some lenders prohibit using a personal loan to invest. But even if your lender allows it, there may be risks involved that you’ll want to be aware of.

Recommended: Personal Loan Glossary

Pros and Cons of Taking Out a Personal Loan

As you’re weighing your decision, it may help to take a look at the overall pros and cons of personal loans:

Deciding Whether to Take Out a Personal Loan

Wondering whether a personal loan makes sense for your situation? Here are a few things to keep in mind as you make your decision.

•   Figure out how much you’ll need to borrow. Remember, you’ll be on the hook for repaying a significant amount of money including interest. There might be hidden fees, too.

•   Make a repayment plan. Going into debt should never be taken lightly, so it’s important to set a realistic strategy to repay the debt.

•   Check your credit score. Your credit history and score will have a significant impact on the loan terms, and interest rates and qualifying criteria will vary from lender to lender.

•   Explore your options. Before applying with a lender, shop around for the interest rate and terms that best fit your needs.

Keep in mind that there may be situations when taking out a personal loan might not make sense. Here are a few instances:

•   You can’t afford your current monthly payments. If making the monthly payments on your existing debt is a challenge, you may want to reconsider whether it’s a good idea to take on any more debt right now.

•   You have a high amount of debt. Shouldering a high amount of debt? Taking out a personal loan could put a strain on your finances and make it more difficult for you to make ends meet or put money away for savings. Plus, carrying a lot of debt could increase your debt-to-income ratio (DTI), which lenders look at in addition to your credit score and credit report when reviewing your loan application.

•   You have a “bad” credit score. A less-than-stellar credit score could reduce your chance of getting approved for a personal loan. If your credit score is considered “bad,” which FICO defines as 579 or below, then you may want to hold off on taking out a personal loan and instead work on your credit. You can help raise your score by paying your bills on time, paying attention to revolving debt, checking credit reports and scores and addressing any errors, and being mindful about opening and closing credit cards.

Recommended: Can a Personal Loans Hurt Your Credit?

Alternatives to Personal Loans

Considering alternative ways to pay for expenses or big-ticket items that don’t involve personal loans? Here are three to keep in mind:

Credit cards

Credit cards offer a line of credit that you can use for a variety of purposes. This includes making purchases, balance transfers, and cash advances. You can borrow up to your credit limit, and you’ll owe at least the minimum payment each month.

A credit card may make sense for smaller expenses that you can pay off fairly quickly, ideally in full each month. Otherwise, be careful about racking up high-interest debt this way.

Home equity line of credit

If you have at least 20% equity — the home’s market value minus what is owed — you may be able to secure a home equity line of credit (HELOC). HELOCs commonly come with a 10-year draw period, generally offer lower interest rates than those offered by a personal loan, and you can borrow as much as you need, up to an approved credit limit. However, you may be required to use your home as collateral, and there’s a chance your rate might rise.

HELOCs might be an option to consider if you plan on borrowing a significant amount of money or if you expect to have ongoing expenses, like with a remodeling project.

401(k) loan

If you need money — and no other form of borrowing is available — then you may want to consider withdrawing funds from your retirement plan, to be repaid with interest. A 401(k) loan doesn’t come with lender requirements and doesn’t require a credit check. However, you may face taxes and penalties for taking out the money. Each employer’s plan has different rules around withdrawals and loans, so make sure you understand what your plan allows.

Borrowing from your 401(k) could be a smart idea in certain situations, like if you need a substantial amount of cash in the short term or are using the money to pay off a high-interest debt.

The Takeaway

When it comes to weddings, home improvement, cross-country moves, and other big-ticket items, a personal loan is typically a better alternative to high-interest credit cards. Other common uses for personal loans include credit card debt consolidation, medical bills, funeral expenses, family planning, and vacation.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

FAQ

What is interest?

Interest is the money you’re charged when you take out a loan from a bank or earn for leaving your money in a bank to grow. It’s expressed as a percentage of the total amount of the loan or account balance, usually as APR (annual percentage rate) or APY (Annual Percentage Yield). These figures estimate how much of the loan or account balance you could expect to pay or receive over the course of one year.

How important is credit score in a loan application?

Credit score is one of the key metrics lenders look at when considering a loan applicant. Generally, the higher the credit score, the more likely lenders are to approve a loan and give the borrower a more favorable interest rate. Many lenders consider a score of 580 to 680 or above to indicate solid creditworthiness, while a score of 740 or higher will qualify you for the most favorable rates.

Can I pay off a personal loan early?

Most lenders would likely welcome an early loan payoff, so chances are you can pay off a personal loan early. However, if an early payoff results in a prepayment penalty, it may not make financial sense to pay off the loan ahead of schedule.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOPL-Q225-065

If you’re like many Americans, you’ll need to take out a home mortgage to buy a house. A home of your own will likely be one of the biggest purchases you’ll ever make, and the terms and interest rates you will end up paying can have big financial consequences.

That’s why it’s important to do what you can to find the best mortgage rates, from having a healthy credit score to comparing lenders to hitting the negotiating table to find the best deal.

Putting Your Financial House in Order

Before you start shopping for a mortgage, take a look at your credit score. A low credit score may be a signal to lenders that lending to you is risky. Those with a lower credit score may find it difficult to get a mortgage — running into limited options — or may be offered loans with higher interest rates.

Generally speaking, the higher your credit score, the easier it will be to get a mortgage. You may be offered better rates, and you may have an easier time negotiating with different types of mortgage lenders. In general, you’ll need a credit score of 580 and the ability to make a 3.5% down payment to qualify for a Federal Housing Administration (FHA) loan. A conventional loan will typically require a credit score of at least 620, but requirements may vary by lender.

Thankfully, an individual’s credit score isn’t set in stone. Those interested in maintaining a good credit score have a few options. First up is requesting your credit report from the three major credit reporting bureaus: TransUnion®, Experian®, and Equifax®. Review each report for errors and contact the appropriate credit bureau if you spot anything that’s incorrect. Credit reports can be ordered from each of the three credit bureaus annually, for free.

Other strategies for building a credit score include paying down credit cards to lower your credit utilization ratio, and making on-time payments for bills and other loans.

Considering a Bigger Down Payment

As a general rule of thumb, lenders may require borrowers to make a 20% down payment when they buy a home. However, many lenders require much smaller down payments, some as low as 3%. And if you qualify for a VA loan, you may not need a down payment at all.

If a borrower makes a down payment smaller than 20%, their lender may require them to purchase private mortgage insurance that will protect the lender in case the borrower fails to make mortgage payments. A larger down payment could potentially help borrowers avoid paying PMI.

As you’re shopping for mortgages, carefully consider how much money you can afford to put down, as a larger down payment can also have an impact on your interest rate.

Typically, a larger down payment translates into a lower interest rate, because taking on a larger stake in a property signals to lenders that you are less risky to loan money to.

Understanding Fixed-Rate vs. Adjustable Rate Mortgages

When shopping for a mortgage, you will typically be offered one of two main financing options: fixed-rate and adjustable-rate mortgages. The difference between the two lies in how you are charged interest, and depending on your situation, each has its own benefits.

Fixed-Rate Mortgage

A fixed-rate mortgage has an interest rate that stays the same throughout the life of the loan, even if there are big shifts in the overall economy. Borrowers might choose these loans for their stability, predictability, and to potentially lock in a low interest rate. Fixed-rate mortgages shield borrowers from rising interest rates that can make borrowing more expensive.

That said, fixed-rate mortgages may carry slightly higher interest rates than the introductory rates offered by adjustable-rate mortgages. Also, if interest rates drop during the lifetime of the loan, borrowers are not able to take advantage of lower rates that would potentially make borrowing cheaper for them.

Adjustable-Rate Mortgage

Interest rates for adjustable-rate mortgages (ARM) can change over time. Typically ARMs have a low initial interest rate. (One popular ARM is the 5/1 adjustable-rate mortgage, which is fixed for the first five years.

However, as the Federal Reserve raises and lowers interest rates, interest rates may fluctuate. That said, there may be caps on how high the interest rate on a given loan can go.

ARMs don’t provide the same stability that their fixed-rate cousins do, but lower introductory interest rates may translate to savings for borrowers.

Once you have a sense of whether a fixed- versus adjustable-rate mortgage is for you, you can narrow your field and start looking at lenders.

Comparing Lenders

When choosing a lender, start your search online, taking a look at a variety of lenders, including brick-and-mortar banks, credit unions, and online banks. The rates you see on lenders’ websites are typically estimates, but this step can help you get the lay of the land and familiarize yourself with what’s out there.

As you shop for mortgage lenders, consider contacting them directly to get a quote. At this point, the lender will generally have you fill out a loan application and will pull your credit information. Many lenders will do a soft credit pull, which won’t impact a potential borrower’s credit score, to provide an initial quote.

Borrowers can also work with a mortgage broker who can help identify lenders and walk them through any transactions. Be aware that mortgage brokers charge a fee for their services.

Recommended: The Mortgage Loan Process Explained in 9 Steps

Taking Additional Costs into Account

When choosing a home mortgage loan, interest rates aren’t the only cost to factor in. Be sure to ask about points and other fees.

Points are fees that you pay to a lender or a broker that are frequently linked to a loan’s interest rate. For the most part, the lower the interest rate, the more points you’ll pay.

The idea of points may feel a little bit abstract, so when talking to a lender, ask them to quote the points as a dollar amount so you’ll know exactly how much you’ll have to pay.

If you plan to live in a house for the long term, say 10 years or more, you may consider paying more points upfront to keep the cost of interest down over the life of the loan.

Home loans may come with a slew of other fees, including loan origination fees, broker fees, and closing costs. You’ll pay some fees at the beginning of the loan process, such as application and appraisal fees, while closing costs come at the end. Lenders and brokers may be able to give you a fee estimate.

When talking with a lender, ask what each fee includes, since there may be more than one item lumped into one fee. And be sure to ask your lender or broker to explain any fee that you don’t understand.

Recommended: How Much House Can I Afford?

Negotiating

Once you’ve gathered a number of loan options, you can choose the best deal among them. There may also be room to negotiate further. When you send in an application, lenders will send you a loan estimate with details about the cost of the mortgage.

At this point, the loan estimate is not an offer, and borrowers have time to negotiate for better terms. Negotiating points may include asking if interest rates can be reduced and if there are other fees that can be lowered or waived.

A strong credit score or the ability to make a bigger down payment could be leverage. It may also help to let the lender know if you do other business with them.

For example, a bank may waive certain fees if you are already a customer of theirs. Also let lenders know if you have other options that offer better rates. Lenders may try to match or beat competitors’ rates to attract you as a customer.

If you negotiate terms that you are happy with, request that they are set down in writing. Lenders may charge a fee for locking in rates, but it may be worth it to eliminate uncertainty as you settle on the right deal.

As you prepare to buy a home, it’s critical to shop around for lenders that offer the best deals, examine the fine print, and then put matters into your own hands, negotiating the details to settle on the deal that’s right for you.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

SOHL-Q225-034

You’ve decided to buy a home. Luckily, you’ve found a real estate agent who can help you find homes to look at and assist with negotiations and inspections. But what if that agent also works for the seller? That is called dual agency, and there’s a lot to consider before agreeing to the arrangement.

Here’s what future homebuyers need to know about dual agency to help decide if it’s the right choice for them.

What Is Dual Agency?

A dual agent represents both the buyer and seller in the same real estate deal. Dual agents are also sometimes referred to as transaction brokers.

Dual agency can be controversial and is banned or severely limited in eight states: Alaska, Colorado, Florida, Kansas, Maryland, Oklahoma, Texas, Vermont, and Wyoming.

Other states do not explicitly make it illegal, but some do warn against using a dual agent.

For example, the New York Department of State issued a memo advising consumers to be extremely cautious when signing on with a dual agent because in doing so they forfeited their right to an agent’s loyalty.

However, in every state where dual agency is legal, the law requires agents to disclose their work with both the buyer and the seller. Both buyer and seller must agree to use a dual agent and sign a consent form indicating they understand what they are agreeing to.

Dual agency may also refer to deal-making of seller’s agents and buyer’s agents at the same real estate company.

For example, Keller Williams, one of the largest real estate firms in the nation, has both seller’s and buyer’s agents. If one of its seller’s agents puts a home on the market, there’s a decent chance that one of its buyer’s agents may have a client for the property.

This is less controversial and poses fewer issues as it is still two separate people overseeing the seller’s and the buyer’s interests.

Recommended: How to Buy a House Without a Realtor

What Are Agents’ Fiduciary Responsibilities?

Real estate agents are legally bound to represent the best interests of their clients. This means agents must disclose any information they have that may or may not help their clients in the negotiating phase.

The obligation to disclose could pertain to information on home inspection reports, defects with the house, or anything else that affects the property’s value.

While representing a buyer, an agent must also disclose any existing relationship with the seller.

Be sure to ask real estate agents important questions about how they work and what they’ll do for you so you’ll know whether they’re the right agent for your needs.

A seller’s agent must disclose any relationship with potential buyers and all offers made on the property—unless, in general, the seller has instructed his agent in writing to withhold certain kinds of offers.

Real estate agents are also expected to put their clients’ financial best interests above their own. This could mean putting in an offer below asking price, which would reduce their own commission.

With all of that in mind, it becomes clear that issues of loyalty and confidentiality become challenging in a dual agency situation.

💡Quick Tip: When house hunting, don’t forget to lock in your home mortgage loan rate so there are no surprises if your offer is accepted.

Pros of Dual Agency

Smoother communication: Having one agent representing both the buyer and seller could help create a smoother communication path. Because the person represents both parties, they may be able to speed up any negotiations. In this case, the dual agent may also understand both the seller’s and the buyer’s timelines, their schedules, and any internal deadlines better than two separate parties could. Buyers wouldn’t have to wait for the seller’s agent to call back and sellers wouldn’t have to wait for a buyer’s agent to call back, because with dual agency they are the same person.

Potentially more information on the home: A dual agent may be able to obtain more information on the home than an agent just representing the potential buyer. In turn, they can relay any pertinent information, such as structural issues, inspection reports, and any updates made to the home, to the potential buyer.

Potentially more access to a larger pool of homes: Remember, dual agency also means a buyer’s agent and seller’s agent working for the same agency. That means, if one home doesn’t work out, the two agents could look internally to find more potential homes their agency represents for the would-be buyers. They may even be able to find a few homes that haven’t hit the market yet.

Possibility for a discount on commission: In a typical real estate transaction, the seller’s agent and buyer’s agent split the commission. A dual agent may be willing to negotiate down their commission since they are double-ending the deal.

Dual agents still have to do their job: In the end, even dual agents must present all offers, prepare all paperwork, present all disclosure agreements, and help to complete the deal.

Recommended: 10 First-Time Homebuyer Mistakes to Avoid

Cons of Dual Agency

Buyers (and sellers) won’t get special treatment: Agents only working for one side will likely be willing to go all out for their client to ensure that the client gets the best deal. An agent working for both sides may be more tempted to get the best deal for themselves to maximize the commission (hey, it’s just human nature to look out for No. 1). A buyer (and a seller) usually wants loyalty above all else when looking for a home. Homebuyers may want to seek out someone who knows what’s needed to buy a house and has their back.

Buyers (and sellers) may not get the price they want: Again, a dual agent’s allegiances are split down the middle during the deal-making process. A seller’s agent is meant to promote the home and get the seller the best price for the home with the fewest contingencies.

A buyer’s agent is on a mission to find every tiny thing that needs to be fixed with the home to get the buyer the best deal they can. If a person is representing both sides, how can they do both? It’s important to discern an agent’s allegiances before signing on the dotted line.

No pushback from the other agent: In a two-sided real estate deal, the two agents will typically go back and forth on the home’s price, any reductions the buyer may want in exchange for repairs, the home’s inspection report, and much more. This creates a system of checks and balances for both sides, which can be important when negotiating a fair deal. However, if one person is playing both sides, things may get muddled, hurting both the seller and the buyer.

The Takeaway

Dual agency is rare in the real estate world because most buyers and sellers want to find an agent who is loyal to them and has their best interests at heart. Still, if you find yourself in a dual agent situation, there is much to know.

There’s another important decision most homebuyers must make: getting the right home loan. Different lenders may offer different terms, rates, or perks that may fit a buyer best.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

Is having a dual agent a good idea?

Dual agency isn’t necessarily a good idea and is banned or strictly limited in eight states. A dual agent’s allegiance may be split between the buyer and seller, and most buyers will prefer a dedicated agent. Real estate agents are fiduciaries and obligated to put their client’s interests before their own, but that may be difficult when they have clients on both sides of a transaction.

What is a common challenge with dual agency?

A common challenge with dual agency is that the agent’s allegiance is split since they represent both the buyer and the seller. While this can facilitate some communications, it may raise problems in terms of whose interests the dual agent is representing.

Do dual agents get double commission?

Typically, in a real estate deal, the agent representing the buyer and the agent representing the seller divide the commission between them. If there is a dual agent — someone who represents both parties s

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

SOHL-Q225-163

A trust can simplify the transfer of what is often a person’s most valuable asset: their real estate. It can keep a home out of the probate process and allow it to become the property of loved ones or a charity upon the homeowner’s death.
For many households, home equity represents their largest financial asset, and it has burgeoned. U.S. homeowners with mortgages saw their equity increase by $281.9 billion at the end of 2024 compared with a year before, according to CoreLogic, a provider of property insights.

Here, a closer look at protecting assets by putting a house into a trust.

Why Put a House in a Trust?

There are two main reasons: avoiding the probate process and protecting your property if you become incapacitated.

Put simply, probate is a court review of a deceased person’s will and assets. This involves resolving any claims against the estate, paying remaining debts, and distributing the decedent’s assets to their designated heirs.

Probate can be a lengthy and costly process. In the absence of a will, the probate court divides the estate according to the state’s succession laws. These proceedings often require hearings and a variety of legal and court fees, which can significantly chip away at the estate before it reaches the heirs.

Even with a will in place, probate is often necessary for your heirs to have the right to carry out your will. Things can become further complicated if the estate includes property in multiple states or the will is contested.

Putting property in trust can avoid probate altogether. A trust designates a successor trustee to manage the estate, as well as beneficiaries to receive assets, after your death. The trust can include clear instructions and conditions for allocating assets. This can help reduce the time and cost to pass your home to your heirs.

It’s also worth noting that trusts can safeguard assets if you become incapacitated and are unable to care for yourself. A trust can be created to take effect in this situation, thus allowing a family member or loved one to manage your estate and assets in your best interests. If you recover, you can resume the role of trustee for the estate.

Recommended: What Is a Trust Fund?

Do You Need a Trust If You Have a Will?

Only one in four U.S. adults has a will, according to one recent report. And even if you have created one, you may wonder whether you are handling your assets properly. For instance, you may ask yourself, “Should I put my house in a trust?” The answer will depend on your own financial goals and the needs of your heirs.

Whom you intend to inherit your house is an important factor to consider. Federal estate and gift tax law permits the transfer of a house and other wealth to a spouse without tax liabilities. However, passing on a house to children or relatives of a subsequent generation can be more complex.

A trust goes into effect once you sign it and is generally more difficult to challenge than a will. Placing a house in a trust also avoids the probate process — it’s not uncommon for the courts to take months or a year to settle a will, especially for larger estates.

Wills and trusts can be complementary tools for estate planning. For instance, a will can take care of smaller assets like family heirlooms that aren’t covered by the trust. Also, wills can be structured to move assets into a trust when you die.

Types of Trusts for Estate Planning

There are multiple options available for putting your house in a trust. It’s important to consider financial goals, your beneficiaries’ needs, and creditor concerns when creating a trust.

Here’s an overview of common types of trusts, including how they work for passing on a house or other property. The basic kinds are revocable and irrevocable and they are typically part of an estate planning checklist.

Revocable Trust

Also known as a living trust, a revocable trust gives grantors more control in the management of their assets while alive. They’re still responsible for tax payments and reporting on investment returns.

If desired, a grantor can make changes or dissolve a revocable trust after it’s created. Getting remarried or buying a home could be possible reasons for altering a revocable trust.

Usually, the grantor (establisher) serves as the trustee (manager for beneficiaries), and a named successor only takes control if that person dies or becomes incapacitated.

A revocable trust becomes irrevocable upon the grantor’s death. A revocable trust does not protect a house and other assets from creditors while the grantor is alive.

Irrevocable Trust

An irrevocable trust differs in that it can’t be modified by the grantor without the approval of all beneficiaries. You effectively give up control and ownership of any assets placed in an irrevocable trust.

So why put your house in a trust with such rigid conditions? Irrevocable trusts can offer greater security for beneficiaries and render assets untouchable to creditors. Plus, you’re not subject to estate taxes because the assets are no longer yours.

Before permanently forfeiting assets to an irrevocable trust, it could be beneficial to consult a lawyer or find a financial planner.

Recommended: Average American Net Worth by Age and Year

Other Types of Trusts

Aside from the two broad categories of trusts, there are more specialized options to address specific needs. Here are some additional types of trusts to consider.

• Charitable Trust: This type of trust transfers assets to a designated nonprofit organization or charity upon the grantor’s death. A charitable trust can be housed within a standard trust to allocate a portion of assets to a nonprofit while leaving the rest for family members or other heirs.

• Testamentary Trust: A trust can be created within a will, often for minors, with defined terms that take effect after your death. This is a type of revocable trust, as changes can be made up until death. It’s worth noting that a testamentary trust does not avoid probate court. The executor will probate the will and then create the trust.

• Generation-Skipping Trust: Instead of passing on a house to your children, you can use a generation-skipping trust to transfer assets to your grandchildren. This is more common for estates that exceed the federal estate tax threshold ($13.99 million in 2025) to avoid some estate tax payments down the line.

• Spendthrift Trust: If you’re concerned about how your beneficiaries will manage their inheritance, you can use a spendthrift trust to set stricter terms. For example, you could define a date or age when beneficiaries gain access to certain assets.

💡 Quick Tip: There are two basic types of mortgage refinancing: cash-out and rate-and-term. A cash-out refinance loan means getting a larger loan than what you currently owe, while a rate-and-term refinance replaces your existing mortgage with a new one with different terms.

Should I Put My House in a Trust?

It’s important to understand the implications of having a house in trust before making a binding decision. Here, the main advantages and drawbacks.

Benefits of a Trust

Bypassing the hassle, delays, and costs associated with probate is a leading reason for using a trust.

Probate expenses can vary by location and the size of the estate but traditionally include legal fees, executor fees, appraisal fees, and other administrative costs. While probate costs will vary depending on the size of the estate and the state you live in, they can often be 3% to 7% of the estate or more.

You may also want to avoid probate to keep the details of your estate private. Probate is a public process that can reveal your estate’s worth and chosen beneficiaries.

Trusts are also useful tools for providing a financial safety net for children in the unexpected event that both parents die. A trustee manages the assets on behalf of any minor beneficiaries. Terms can be set to transfer control of assets held in the trust to children when they reach a certain age.

Putting certain assets in a trust could help some seniors qualify for Medicaid. If you’re 65 or older, your home and furnishings are usually exempt from the asset limit to qualify, but the threshold is low: around $2,000 in most states.

Disadvantages of a Trust

Setting up a trust can be complex. There are usually more costs in creating a trust than a will.

With a revocable trust, you need to track income from assets held in the trust to report on your personal tax returns. If you designate a third-party trustee to manage the trust, maintenance costs could add up over time.

And if you put just your home in a trust, your other assets will still be subject to the probate process.

When a house is the only large asset, buying a house from a family member is a possible alternative. Though this can be contentious among relatives, it’s another option to pass on a valuable asset to the family while providing some financial security.

The Takeaway

Estate planning isn’t always easy. Putting your house in a trust is one strategy to reduce the time and costs associated with inheritance. Probate costs can eat up 3% to 7% of an estate, and putting assets into a trust can help avoid that. Even if you put a house in a trust, however, you are still liable for any mortgage payments due, which you may be able to lower via refinancing.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

What are the disadvantages to putting your house in a trust?

There are some disadvantages to putting your home in a trust. Getting the trust set up and making sure it is being properly maintained can be expensive and complicated. With a trust, you will lose some control over your home, even with a revocable trust, but especially with an irrevocable one. And putting your home in a trust won’t prevent the rest of your estate from going through probate.

Can I put my house in a trust if it’s not paid off?

Yes, you can put your house in a trust even if you still have a balance on the mortgage. However, there is a specific process you’ll need to follow, and you will probably need to get permission from your lender. Your mortgage may have a “due on sale” clause, which means that the lender will ask you for full payment when you transfer the house’s title, so working with your lender may also help you avoid that. After that, you’ll have to transfer the title of the home to the trust and figure out how to manage insurance and any other liabilities.

Why do people put their house in a trust?

Often, people put their house in a trust to avoid the time and expense of having the home go through probate after their death. A trust can also help ensure continuity of the management of your house if you become incapacitated since your successor trustee would take over the management as needed.

Photo credit: iStock/BrianAJackson

SOHL-Q225-174