What first-time buyers should know before applying for a mortgage

Buying your first home is one of the most exciting milestones in life — and one of the biggest financial decisions you’ll make. Before you sit down with a lender, a little preparation goes a long way.

Know your credit score

Your credit score is one of the first things a lender will review. A score of 620 or higher is typically needed for a conventional loan, while FHA loans may accept scores as low as 580. You can pull your free report at AnnualCreditReport.com — check for errors and dispute anything that looks incorrect before you apply.

Understand your debt-to-income ratio

Your debt-to-income (DTI) ratio compares your monthly debt payments to your gross monthly income. Most loan programs want to see a DTI below 43–45%. If yours is higher, paying down a credit card or car loan before applying can make a real difference.

Gather your documents early

Lenders will ask for W-2s, recent pay stubs, two months of bank statements, and two years of tax returns. Having these ready before you apply speeds up the process and signals that you’re a serious buyer.

Get pre-approved, not just pre-qualified

A pre-approval letter — based on verified income and credit — carries much more weight with sellers than a basic pre-qualification. In a competitive market, it can be the difference between getting the house and losing it.

Ask questions

There are no dumb questions when you’re making a six-figure financial decision. A good loan officer will take the time to explain every step of the process in plain language. If something isn’t clear, ask again.

Ready to talk through your options? Reach out today.