Everything you need to know about getting a mortgage — from credit score to closing day.
Buying your first home is one of the most significant financial steps you'll take. The mortgage process can feel overwhelming — dozens of terms, multiple parties, months of paperwork, and large numbers at every turn. This guide walks you through the entire process in plain language so you know exactly what to expect and what decisions to make along the way.
🧮 Use our Mortgage Calculator alongside this guide to run real numbers for any scenario you're considering.
Before you start looking at homes or talking to lenders, understand your starting position across three key dimensions:
Your credit score is one of the most important factors lenders use to determine whether to approve your loan and at what interest rate. A higher score unlocks better rates, which means significantly lower total interest paid. Here's how scores generally map to loan access:
Check your credit report for errors before applying — errors are more common than people realize and can be disputed and corrected within weeks.
Lenders calculate two DTI ratios: front-end (your proposed housing payment ÷ gross monthly income) and back-end (all monthly debt payments including housing ÷ gross monthly income). Most conventional lenders want a back-end DTI below 43%; FHA loans can go up to 50% in some cases. The ideal DTI is below 36%.
You'll need cash for: down payment (3–20% of purchase price), closing costs (2–5% of loan amount), moving expenses, and post-move cash reserves (lenders typically want 2–6 months of payments in savings). A $400,000 home with 10% down and 3% closing costs requires at least $40,000 + $10,800 = ~$51,000 in available cash at minimum.
Not government-backed; meet guidelines set by Fannie Mae and Freddie Mac. Require a minimum 620 credit score and 3% down payment (though 20% avoids PMI). Best for buyers with good credit and stable income. Conforming loan limit in most areas is $806,500 in 2026.
Insured by the Federal Housing Administration. More flexible qualifying criteria — scores as low as 580 (with 3.5% down) or 500 (with 10% down). The catch: FHA loans require mortgage insurance premium (MIP) for the life of the loan if you put less than 10% down, unlike conventional PMI which can be removed.
Available to eligible military veterans, active-duty service members, and surviving spouses. No down payment required, no PMI, and rates are typically competitive. A VA funding fee applies but can be rolled into the loan. One of the most favorable mortgage products available.
For homes in eligible rural and some suburban areas. Zero down payment required. Income limits apply (typically 115% of the area median income). Backed by the Department of Agriculture. Can be an excellent option if you qualify geographically and by income.
Pre-qualification is an informal estimate based on self-reported information — no credit check, no verification. Pre-approval involves an actual credit pull, income verification (pay stubs, W-2s, tax returns), and asset verification. Pre-approval carries real weight with sellers.
Apply with 2–3 lenders to compare rates — multiple mortgage inquiries within a 14–45 day window are treated as a single inquiry by credit scoring models, so shopping around doesn't hurt your score. Compare APRs (which include fees) rather than just interest rates.
A fixed-rate mortgage keeps the same interest rate for the entire loan term. Your principal and interest payment never changes, regardless of what happens to market rates. This is the safe, predictable choice.
An adjustable-rate mortgage (ARM) starts with a fixed rate for an initial period (typically 5, 7, or 10 years), then adjusts periodically based on a benchmark rate. ARMs are lower initially but introduce payment uncertainty. They make sense if you're confident you'll sell or refinance before the adjustment period begins.
Once you have an accepted offer, lock your rate. Rate locks typically last 30–60 days and protect you from rate increases during underwriting. Some lenders offer float-down options that let you capture a lower rate if rates fall during the lock period — worth asking about.
After your offer is accepted and you're under contract, the lender's underwriting team verifies every piece of your application: income, employment, assets, the property's value (via appraisal), and title status. Be responsive — delays in providing requested documents are the most common reason closings are pushed back.
Don't make any large purchases, open new credit accounts, or change jobs during underwriting. Any change to your financial profile can trigger a re-evaluation and potentially kill the loan approval.
Expect closing costs of 2–5% of the loan amount. They typically include: origination fees, appraisal, title insurance, title search, attorney fees (in some states), prepaid interest, homeowners insurance premium, and property tax escrow. You'll receive a Closing Disclosure 3 business days before closing — review it carefully and compare to your Loan Estimate from when you applied.
🧮 Ready to run the numbers? Our Mortgage Calculator gives you a full payment breakdown with property tax by state, amortization schedule, and total interest paid.