Frequently asked questions

Do I need a 20% down payment?

No, you do not have to make a 20% down payment. A down payment may seem like the only way to get a competitive interest rate or low monthly payment, but it’s not. Things like credit history, income, and debt affect your loan program (and ultimately payments), too. There are loan programs designed with first-time home buyers in mind. Even if you are ready to make a large down payment, it still may be in your best interest to weigh all options.

Leverage down payment assistance. Many state and local agencies offer grants or loans. And, you don’t have to be a first-time home buyer to qualify!

Go with mortgage insurance. Mortgage insurance can increase your purchase power and allow you to keep your hard-earned money in savings.

Is it cheaper to rent than own?

If you plan on renting for more than just a couple of years, it’s in your best interest to look into a home purchase. That’s because mortgage payments are stable, whereas rent can rise annually, and renting doesn’t offer a lot of cost savings. Why not invest in something that can increase your wealth? There are many first-time home buyer assistance programs available to get you started.

Do I have to pay off my student loans first?

It’s true that millennials face a higher student loan burden than any generation before them; however, there are new guidelines that make it easier to qualify for a mortgage with student loans. Having student loan debt could work in your favor. It may improve your debt-to-income ratio, so you qualify for a better loan program or interest rate. Though it may seem overwhelming to add on any more debt, you have to remember your home will build equity. That equity can eventually be used to pay off high-interest debts like student loans, personal loans, or credit card debt.

Does my credit score need to be perfect?

Your credit score does not have to be perfect to buy a home. Though keep in mind, If your credit score needs work to buy a home, chances are it needs work to rent a home. Poor credit challenges both renters and homeowners alike. Work on strengthening your credit. There are many programs available to get you started.