I am currently in the process of buying my very first home. It is extremely exciting to look at all the possibilities and I have learned a lot along the way. There are some great websites out there to help guide you in the right direction and clear up anything that doesn't make sense. But for a one-stop-shop kind of idea, I thought I would put together some of the questions I had in this process to help anyone out there in a similar position.

Escrow: This is helpful for property taxes and insurance purposes. Basically, part of your monthly mortgage payment goes toward the mortgage itself, and part goes toward this escrow to then pay your property tax and insurance. Essentially, it takes the thinking out of it when it comes time for those things to be due.

PITI: This is an acronym for what your monthly payment should be. It includes the Principal, Interest, Taxes (property tax), and Insurance (homeowners' insurance). Part of this payment (taxes and insurance) are what goes into your escrow.

Private Mortgage Insurance (PMI): If you, as the home buyer, put down less than 20% as a down payment, most lenders require a PMI to protect themselves in case you default on your payment (aka: in case you don't pay your mortgage).

Closing costs: This can be negotiated between you, as the buyer, and the seller. Closing costs go toward a handful of things including lender fees, deed filing fees, inspection and appraisal fees, etc. But it can be negotiated whether you will pay for them or if the seller will.

Fixed-rate loan: The interest rate will never change throughout the life of the loan.

Adjustable rate mortgage loan (ARM): The interest rate can change, but there are usually guidelines to how often and how much it can change. A common example is the interest rate will stay the same for the first five years of the loan, and then be adjusted on a yearly basis for the remainder - this is referred to as a 5/1 ARM loan.

Federal Housing Administration (FHA) loan: These loans are managed by HUD (which stands for Department of Housing and Urban Development). This type of loan insures the lender in case you default on your loan, which usually means you need a PMI (pop quiz: what does PMI stand for?). Good news: you can usually make a down payment of 3.5% - so on a house listed at $100,000, you would only need to put down $3,500 (you can certainly put down more though).

VA Loan: This is through the Department of Veterans' Affairs and is for military service members and their families.

As you can see, there is so much to learn in the home buying process! If you are like me and looking for your first home, congratulations! If you have been there, done that, share your wisdom with me!