What credit scores are needed?

To obtain a mortgage with favorable terms, a good credit score is generally considered to be 620 or higher. However, some programs will require a minimum score of 640.  

 

Would I qualify for DPA if I already own a home?

Yes, while your funding options may be limited, there are downpayment assistance programs available for individuals who already own a home.  

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 Is it a good time to purchase/sell a home?

The best time to purchase or sell a home is when you are financially ready. If you have a credit score of 620 or higher, consistent and stable income, and money saved it may be a good time for you to purchase and/or sell a home.  

 

 I would like to view homes first; can I apply for the mortgage when I find the home I would like to buy?

No, it is best practice to get preapproved for a mortgage before viewing homes. Pre-approval gives you an estimate of the loan amount you qualify for and can make you more attractive to sellers. 

 

Could a family member gift me funds to purchase my home?

Yes, it is common for family members to gift funds to help someone purchase a home. When a family member provides funds as a gift to help with the down payment, closing costs, or other expenses associated with buying a home, it can make homeownership more accessible. 

 

Could I use multiple DPA/first-time homebuyer programs?

No 

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How long does it take to purchase a home?

The timeline for purchasing a home can vary widely depending on various factors, including market conditions, the complexity of the transaction, and individual circumstances. However, the national average is about 30 to 45 days.  

 

Are closing costs and down payment the same? No, closing costs and down payment are not the same. The down payment is a specific percentage of the home's purchase price that the buyer pays upfront while closing costs are the various fees and expenses associated with the homebuying process. Both the down payment and closing costs are important considerations for budgeting when purchasing a home, and homebuyers must be aware of and plan for both of these expenses. 

 

What is DTI?

The debt-to-income ratio (DTI) is a financial metric that compares an individual's or household's monthly debt payments to their gross monthly income. It is expressed as a percentage and is used by lenders to assess a borrower's ability to manage monthly payments and take on additional debt responsibly. 

 

 What are the upfront costs I would have to cover in a transaction?  When buying a home, there are several upfront costs that buyers are expected to cover. These costs are in addition to the down payment and are typically incurred during the home buying process. Here are common upfront costs that buyers may need to pay: 

• Earnest Money Deposit: An earnest money deposit is a good faith deposit made by the buyer to demonstrate  serious intent to purchase the property.

• Home Inspection Fee: Buyers often hire a home inspector to assess the condition of the property. The cost of the home inspection is typically paid by the buyer and is due at the time of the inspection. 

• Appraisal Fee: Lenders may require an appraisal to determine the fair market value of the property. The buyer is typically responsible for covering the appraisal fee. 

• Down Payment: While the down payment is part of the overall cost of the home, it is an upfront payment made at the time of closing.

• Closing Costs: Closing costs encompass various fees and expenses associated with the home buying process. These can include loan origination fees, title insurance, attorney fees, recording fees, and more. Buyers are usually responsible for paying closing costs, and these costs are typically due at the closing table. 

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What is the difference between pre-qualification and a pre-approval letter? 

Prequalification is an informal process where a lender assesses your financial situation based on the information you provide. This information typically includes details about your income, assets, debts, and an estimate of your credit score. Preapproval is a more formal process. You submit a mortgage application, and the lender verifies the information you provide. This includes checking your credit report, verifying income and employment, and assessing your overall financial situation.