Do You Qualify for a Loan to Buy a Home? (The Answer Might Surprise You!)

The most recent data set shows that 65.1% of homes in the United States are owner-occupied as of 2019.

Being a part of a large number of renters can make you feel like a hamster running in a wheel — paying a monthly amount to someone without gaining any equity in return.

Have you been considering that it may be time to buy a home?

If you’ve been scrolling through housing listings, and picking out neighborhoods, it is time to see if you qualify for a loan to buy a home.

The answer may surprise you

Savings and Loans

Do you have a nest egg built up? A 401k through work? These saved amounts may be able to help you purchase a home.

Get an idea of your credit score before you speak to a banker about a mortgage. You can do this by using any number of free services that can get an estimate of your credit score, or you can use your annual credit check with TransUnion or Equifax, to get the exact score.

A credit check takes into account your income, your debts, your assets, and your ability to pay your bills on time. All of these factors can go into whether you will be a good mortgage candidate, but don’t fret — your credit doesn’t need to be perfect.

With a credit score of at least 620, which is technically a “bad” credit score on the scale, there are usually mortgage solutions available. There are even government programs for people struggling, to find their way to homeownership.

Take a Trip to the Bank

One of the first things to do when you’ve decided to see what it might take to purchase your own home is to head to the bank or credit union you currently use.

A mortgage lender will run a credit background check when you go to apply for a loan. You will need to apply for the loan to see what you qualify for in lending.

Your bank or credit union is the first place to check for a mortgage loan. Why? Because they know your money best.

Programs for Home Buyers

After you have checked out what your personal bank or credit union can offer you as you look to buy a home, check out programs available for specific home buyers. For example, first time home buyers may get a hand up from the U.S. Department of Housing and Urban Development.

First time home buyers programs help those who don’t have the preferred 20% to put down on a house. As you build equity in homeownership, that amount may become easier to put down if you should move to another home and sell your first one.

There are also programs for specific demographics of home buyers. Programs can be specific to professions. One of those is home loans for medical professionals.

Go Buy a Home

After you have checked out the necessary venues to secure yourself a mortgage — which you will — go buy a home to make your own.

Did this piece help you get on the path to homeownership? Check back often for great new content.