Buying your first home? Here is exactly what to expect.

Guide · First Time Buyers

If this is your first time buying a home, you are probably carrying around a list of half answered questions. How much do you actually need saved. Does your credit have to be perfect. What happens after you make an offer. None of it is complicated once someone walks you through it in order, so that is what we are going to do here.

The three things that actually decide what you qualify for

Every mortgage decision comes down to three things working together. How much you are putting down. How your credit history looks. And how much of your monthly income is already committed to other payments, such as a car loan, student loans, or credit cards. None of these three numbers has to be perfect on its own. Lenders look at the whole picture, and a strength in one area can make up for a weaker number somewhere else. This is exactly why two people with very different financial situations can both end up qualifying for a loan on the very same house.

How much you really need for a down payment

The idea that you need twenty percent down to buy a home is one of the most expensive myths in real estate, because it talks people out of buying years before they actually needed to wait. Conventional loans allow as little as three percent down for qualified buyers. A loan backed by the Federal Housing Administration allows three and a half percent down. If you have served in the military, a loan backed by the Department of Veterans Affairs can let you buy with nothing down at all. The chart below shows what that actually looks like in real dollars on an example home, so you can see how different the true number is from the twenty percent myth most people are still carrying around in their head.

Example based on a $400,000 home price used for illustration only. Your actual down payment depends on the loan program you qualify for and the price of the home you choose. This is not a quote.

The loan programs available to you, explained simply

Conventional loans

A conventional loan is not backed by a government agency. It typically asks for a slightly stronger credit history than the government backed programs, but it can come with a lower monthly cost once your down payment is large enough to remove the mortgage insurance requirement over time.

Loans backed by the Federal Housing Administration

These loans are backed by the government and built specifically to make homeownership more reachable for buyers with a smaller down payment or a shorter credit history. The tradeoff is that mortgage insurance stays part of the payment for most of the life of the loan, so it is worth comparing both paths before you decide.

Loans backed by the Department of Veterans Affairs

If you are an eligible veteran, an active service member, or a surviving spouse, this is usually the strongest loan available to you. It allows a purchase with nothing down and does not require monthly mortgage insurance at all.

Loans backed by the United States Department of Agriculture

In eligible rural and some suburban areas, this program allows qualified buyers to purchase a home with nothing down. Eligibility depends on the location of the property and your household income, so it takes a quick check together to confirm whether it applies to you.

What your credit actually needs to look like

You do not need flawless credit to buy a home. Most loan programs have room for a wide range of credit histories, and the piece that matters most is often not your score itself but the story your recent payment history tells. Paying everything on time in the months leading up to your purchase matters more than chasing a perfect number. If you are carrying balances on credit cards, paying them down before you apply can help more than almost anything else you could do in the short term.

The homebuying process, from start to finish

• Get pre approved so you know your real budget before you start looking at homes
• Work with a real estate agent to find homes in your range
• Make an offer and negotiate the terms with the seller
• Schedule a home inspection so you know the true condition of the property
• The lender orders an appraisal to confirm the home is worth what you agreed to pay
• Your file moves through underwriting while the lender verifies your documents
• You sign the final paperwork and get the keys at closing

Mistakes that slow first time buyers down

• Shopping for homes before talking to a lender, which leads to falling in love with a house you cannot actually afford
• Changing jobs or making a large purchase like a car in the middle of the process
• Moving money around or making large unexplained deposits right before applying
• Only thinking about the sale price and forgetting property taxes, insurance, and any homeowner association dues that come with the monthly payment

Let us find out what you actually qualify for

The only way to really answer any of these questions is to run your actual numbers, and that conversation usually takes about ten minutes. Reach out and we will walk through exactly where you stand today and what it would take to get you into a home.

This guide is general education, not a commitment to lend or an offer of credit. Program availability, terms, and qualification guidelines vary by lender and can change, and all loans are subject to underwriting approval. For guidance specific to your situation, reach out directly. Garrett Potz, NMLS #631592 · Affinity Home Lending, Company NMLS #1181151 · Equal Housing Lender.