What does it take to qualify for a home loan?

St Paul, MN: The days of the easy money, and just about everyone getting a home loan are long gone. Today, mortgage lenders are required to prove and document your ability to safely afford the house payment, and show that you are responsible with OK or better credit.

So you’ll usually need these things in order to get a home mortgage loan:

  • Enough money for the Down Payment (3% is realistically your minimum)
  • Two years of good steady employment
  • OK or better credit score (640 or higher is your target)
  • Monthly income that’s about 3 times higher than your expected monthly mortgage payment
  • Keep your debt low (especially credit card balances)
  • Any major negative item be OLD (bankruptcies, foreclosure)
Apply Online
No Obligation to apply, and see what YOU qualify for.

Don’t meet that basic criteria today? Consider these additional options.

  • Down payment assistance is potentially available (Be realistic, you can’t buy a home with no money. You will still need a few thousand dollars MINIMUM). But check out our First Time Home Buyer programs.
  • No Down payment is possible if you are active or retired U.S. Military (VA Loan) or want to buy a home in a rural area (USDA Loan), you still need a few thousand dollars MINIMUM)
  • Apply anyway. Don’t assume you can’t get a mortgage. There may be a loans option. Even if it is a not today, they can let you know where your deficiencies are so you can work towards qualifying in the future.
  • Use a Mortgage Broker. A mortgage broker represents lots of different lenders, not just the offerings of one bank. They simply have more options than banks and credit unions.
  • Get a co-signor. See if a family member or very close friend with a higher income and better credit than yours will cosign a loan for you.
  • Lack of Down Payment.  Many program allow you to get a gift for down payment from your family. You can also borrow money for down payment from your 401k
  • No proof of income?  True no proof of income loans don’t exist anymore, but you can possibly get a non-conforming loan by using your bank statement loan programs where we use your bank deposits as qualifying income. These loans come with higher interest rates, so you should always try for a traditional loan first.

Plan for the future. 

Even if you can’t buy a home right now, one fact I know, is if you do nothing, nothing will change. If you understand the guidelines and work at it, there is no reason why anyone can not be a home owner in the not too distant future. Check out my personal web site at iMortgageJoe.com


5 low down payment home loans

5 Low Down Payment Home Loans

Minneapolis, Minnesota:  Face it, for most people, the biggest obstacle to buying a home is a lack of down payment.  Here are 5 low down payment home loan options to help you get into your own home.

Zero Down Payment

  1. VA Loans: Available for U.S. Military personal, both current and former is a no down payment loan with no mortgage insurance. By far the most amazing home loan available.  Get VA Loan information
  2. USDA Rural Development Loans: Available for those wishing to buy in rural areas. This program is no down payment required. Income limits apply. Get USDA loan information.

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Low Down Payment

  1. Conventional 3% down. This low down payment loan for first time home buyers just recently came back into the market from Fannie Mae and Freddie Mac. Good credit or better required, and must take first time home buyer education classes. Get 3% down HomeReady loan information
  2. FHA Loans: This program only requires 3.50% down payment, and is probably the most popular loan. Very flexible underwriting guidelines compared to other programs for everything from weak credit, to higher debt-to-income ratios, and shorter waiting periods than other loans for past bankruptcy and foreclosure.  Get more FHA LOAN information
  3. Down payment assistance programs: Combine one of the standard loans with a down payment assistance program to ease your out-of-pocket expenses to get into a home. Most of these programs are loans that need to be paid back, require you to be a first time home buyer, and to take home buyer education classes. Program vary greatly by city, county, state, or community programs. Talk to a Loan Officer in your area for local program information.  Learn more about down payment assistance programs in MN.