Home Buying FAQs: Frequently Asked Questions
In 2017, we launched a blog series to answer some of the most frequently asked questions about buying a home. We have identified the most common questions based on emails received from home buyers over a five-year period. You'll find them listed below, with links to the answers.
Mortgage Loan Questions
How much debt can home buyers have?
The amount of debt you have when you apply for a mortgage loan can determine whether or not you get approved. Here's what you need to know about debt-to-income ratios.
What's the minimum credit score for borrowers?
This is another frequently asked question about buying a home. The short answer: Most mortgage lenders today prefer to see a credit score of 600 or higher. But that's not set in stone.
How does a 15-year mortgage work?
The 30-year fixed-rate mortgage is the most popular type of home loan in use today. But there are some advantages to using the shorter term 15-year option. It could save you thousands.
What factors affect my mortgage rate?
This is one of the most frequently asked questions from first-time buyers. There are actually several factors that can determine the rate you receive from a lender. Here are the seven most common.
Are there loans with no down payment?
This question came from a reader in New Jersey, who wanted to know what the best mortgage is for first-time home buyers with no down payment. Here are some options worth considering.
What if you put less than 20% down?
You don't necessarily need to make a down payment of 20% when buying a home. But if your loan-to-value (LTV) ratio rises above 80%, you might be required to have mortgage insurance.
What's the lowest possible down payment?
A reader asked us the question: What is the lowest possible down payment I can make on a conventional mortgage loan? The answer might surprise you. Hint: it's a lot less than 20%.
How does my down payment affect PMI?
There is a direct relationship between the amount of money you put down on a home purchase, and whether or not you have to pay for private mortgage insurance. Here's how it all works.
What is a "conditional" mortgage approval?
In a lending context, a conditional approval occurs when the underwriter is mostly satisfied that the borrower meets loan guidelines, but there are one or "conditions" to be resolved.
Questions About the Home Buying Process
Is a home inspection required?
The short answer is no, an inspection is generally not required for buyers. But if you use a mortgage loan, your lender will likely require an appraisal to determine the market value.
Where to Learn More
This is an ever-growing list of frequently asked questions about buying a home. We receive questions from readers on a regular basis, and we answer the most common ones right here on our website. If you have a question that is not listed above, check out our research library for home buyers. It's a gateway to even more articles and tutorials.