Your Partner in Home Buying
Budget & Affordability
Before you start house hunting, know what you can comfortably afford and your home financing options. Understanding your budget keeps you focused, confident, and financially secure throughout the process.
Know Your Numbers
Lenders look at your debt-to-income ratio (DTI):
- Front-end DTI: Mortgage payment only (keep it under 28% of gross income)
- Back-end DTI: All monthly debts (stay under 43% if possible)
Example: If you earn $5,000/month before taxes, aim for a mortgage payment around $1,400 (including principal, interest, taxes, and insurance—aka PITI).
Upfront Costs to Expect
- Down Payment: Ranges from 0% (VA/USDA) to 3–5% (FHA/Conventional)
- Closing Costs: Typically 2–6% of the purchase price
- Inspections: Plan for $350–$500, plus optional add-ons
Don't Forget Maintenance
Set aside 1–2% of your home’s value annually for repairs, and aim to build a 3–6 month emergency fund.
Use a mortgage calculator and budget worksheet to estimate monthly payments and stay on track.
Credit & Financial Prep
Strong finances = more loan options and better rates. But don’t worry—perfect credit isn’t required.
Credit and Financial Scores
- FHA: 580+ (3.5% down)
- VA: No set minimum (most lenders prefer 620+)
- USDA: Around 640
- Conventional: 620+ (740+ for best rates)
Easy Ways to Improve Your Credit
- Pay bills on time
- Keep credit card balances below 30%
- Avoid new debt
- Check your credit reports for errors
Manage Existing Debt
High student loans or car payments can impact your loan amount. Pay down or refinance debt if needed.
Save Smart
Set a down payment goal and automate savings. Use bonuses, tax refunds, or side income to build your fund. Ask about Florida down payment assistance programs—many buyers qualify.
Loan Types Explained
Choosing the right loan helps you buy smarter. Here’s a quick breakdown of available loan types:
FHA Loan
- Best for: Buyers with lower credit or limited savings
- Pros: 3.5% down, flexible credit
- Cons: Mortgage insurance for life, property guidelines
VA Loan
- Best for: Veterans, active duty, qualifying spouses
- Pros: 0% down, no PMI, great rates
- Cons: Eligibility required, one-time funding fee
USDA Loan
- Best for: Buyers in rural/suburban areas
- Pros: 0% down, low rates, low insurance
- Cons: Income limits, location restrictions
Conventional Loan
- Best for: Strong credit and savings
- Pros: 3% down (first-time buyers), no PMI at 20% equity
- Cons: Higher credit standards, PMI if <20% down
What Is PMI?
Private mortgage insurance is required if your down payment is under 20%. With a Conventional loan, you can cancel it once you reach 80% equity.
Florida Down Payment Help
Explore options like:
- FL Assist: Up to $10K, 0% interest
- HLP Second Mortgage: $10K, 15-year repayment
- HFA Grants: 3–5% of purchase price
Salute Our Soldiers: For veterans and military families
Getting Pre-Approved
Pre-approval gives you a competitive edge and clear budget.
Pre-Qualification vs. Pre-Approval
- Pre-Qualification: Quick estimate, not verified
- Pre-Approval: Verified by lender, shows sellers you're serious
What You’ll Need
- Pay stubs, W-2s/tax returns
- Bank statements
- Photo ID
- VA Certificate (if applicable)
- Info on other income or debts
Compare Lenders
Get quotes from 2–3 lenders. Compare more than just rates—look at fees, monthly payments, and service quality.
Ask These Questions
- What programs do I qualify for?
- What’s the full monthly payment?
- What are your fees?
- Do you offer Florida assistance programs?