First-Time Homebuyers

Improving your credit score can significantly reduce interest costs on your home loan. Here's how you can improve it:

• Make small purchases with your credit card while keeping usage at 30% or less of the credit limit

• Ask for a higher credit limit to lower overall utilization

• Don't close your old credit cards, just don’t use them anymore

• Pay your bills on time, and let any balance hit the statement first

Be patient; some credit blemishes can only be repaired with time.

To get preapproved for a mortgage, you'll need:

• Last two pay stubs with year-to-date income

• W-2 forms & possibly tax returns from the previous two years

• Two months of bank statements (all pages & assets)

• Other income & loan documentation showing the amount and source

Determining how much you can afford comes down to comparing income to housing costs:

• Lenders consider home expenses like principal, interest, taxes, private mortgage insurance (PMI) + HOA (Homeowners Association) dues, if applicable

• Lenders won't consider personal bills like utilities, phone, etc.

Generally, aim to keep housing costs below 36% of your gross income.

Get a Head Start!

Contact a Mortgage Lender

Private Mortgage Insurance (PMI) is an additional insurance policy included in a monthly mortgage payment if the down payment is less than 20% of the home's purchase price.

It is an added protection for the lender, not for the buyer. This premium is based on the risk of the loan. The riskier the loan, the higher the premium.

Beyond the down payment and purchase price, closing costs cover additional fees for securing the new home.

Expect to Pay For:

• Loan processing fees

• Home Appraisal

• Credit report fees

• Flood certifications

• Title work

• Potential inspections

• Pre-paid homeowner's insurance (1-year)

• Reserve account (escrow) for taxes and insurance

While it might seem overwhelming initially, remember your lender is there to guide you through every step before you submit an offer.