Need a lot of down payment


"I can't afford the down payment of purchasing a home."


You can afford the down payment with the new 2009 Tax Credit.  There are various programs that help assist with down payments.


Qualified, first-time home buyers using a Federal Housing Administration (FHA)-insured mortgage now can apply the $8,000 federal tax credit toward their down payments.

Currently, borrowers applying for an FHA-insured mortgage are required to issue minimum down payments of 3.5 percent. Previously, FHA-approved lenders were not allowed to monetize the tax credit as part of the 3.5 percent; however, under the new guidelines, borrowers now can use the tax credit as additional down payment, or for other closing costs.


For a list of ways to help you, Please click Down Payment Programs.


Need excellent credit


"I don't have an excellent credit score over 750….I know I won't qualify for a loan."


You don't need excellent credit scores but you do need credit.  Credit plays a major role in your everyday life.  You need credit just for about anything you can think of.  Credit is the determining factor for lenders.  Lenders will analyze your debt-to-income ratio to determine if you can pay your mortgage payments with your outstanding debt.  The minimum credit score to qualify for a FHA loan is 620.


If you don't think you have good credit, you should start building your credit now.  There are numerous ways to build your credit.  The most common and popular way is to apply for a credit card.  This does not mean you go and apply for 10 credit cards. 


My recommendation would be to open one credit card and see how well you can deal with the payments.  Two or Three credit cards would be sufficient to build your credit history.  Do not max out your credit card if you are not able to pay it off.  This will make your payments more complicated if you have several credit cards.  Always make your payments on time. 


Can't afford my mortgage payment


"How can I afford to pay my mortgage payments?  I just know the payments will be too much for me."

Let's put it this way.  Are you currently renting a house or an apartment?  Are you paying rent around $800 to $1400?   If your answer is a "yes" to these two questions than you can afford your mortgage payments.

There are several benefits in owning your own home.  Click Buying vs Renting.


I need to find a house before I can get a loan


This might seem like a good idea but it is not.  As a buyer, you would want to get pre-approved for a loan first.  The reason is you will know what you can afford and you will have the bargaining power with the seller.