It’s best to make sure that you are properly prepared for the home buying journey, especially your mortgage. We’ve listed below a few things to prepare you:
1. It’s not mandatory to put 20% as a down payment. In fact, there’s a wide spectrum of the minimum mortgage down payments ranging from 0% to 20%. A good mortgage broker can help you understand which ones you'd qualify for.
2. You don’t need to have perfect credit. While it's definitely advantageous to have a good credit score to quality for the best rates, there are programs to help make home ownership more accessible. In fact, it's possible to qualify for an FHA loan with a credit score as low as 500. Fannie Mae and Freddie Mac loans can start as low as 620.
3. The seller can cover the closing costs. If you are worried about the unknowns of closing costs, keep in mind that you can negotiate with the seller to have them cover some or all of the costs in your offer.
4. You can test the waters. Rather than starting with the home search, you can see if you can pre-qualify for a mortgage by asking a lender if you can be pre-approved for a home before ever committing.