A First-Time Homebuyer's Guide to Getting Mortgage-Ready
Buying your first home starts long before you find a listing you love — it starts with getting your finances in shape so lenders (and you) know exactly what you can afford. Here's what to work through in the months before you apply.
1. Check your credit before a lender does
Pull your credit reports and look for errors, old collections, or high balances you can pay down. Most conventional loans want a score of 620 or higher, though FHA programs can work with scores as low as 580. Paying down revolving balances is usually the fastest way to move the needle.
2. Get real about your budget
Lenders look at your debt-to-income ratio — your monthly debt payments divided by your gross monthly income. Most programs want that number under 43-50%, but a lower ratio gives you more room and better pricing. Use our payment calculator to see how different home prices affect your monthly payment.
3. Save for more than just the down payment
Down payments can range from 0% (VA), to 3-3.5% (conventional/FHA), to 20% or more if you want to avoid PMI. But also budget for closing costs (typically 2-5% of the loan amount) and a reserve fund for after you move in.
4. Avoid new debt and big purchases
Lenders re-verify your credit and employment close to closing. Opening a new credit card, financing a car, or changing jobs during the process can delay or derail your approval.
5. Get pre-approved, not just pre-qualified
A pre-qualification is a quick estimate. A pre-approval involves verifying your income, assets, and credit, and gives sellers real confidence in your offer. Ask your loan officer to walk you through document requirements early so there are no surprises.
- Two years of tax returns and W-2s (or 1099s if self-employed)
- Recent pay stubs
- Two to three months of bank statements
- Photo ID and Social Security number
Ready for the next step?
Our loan officers can review your specific situation and tell you exactly what you qualify for — no obligation.
Talk to a Loan Officer