Most homebuyers find that they need to finance at least part of their home purchase. Therefore, the first stage in finding the right home is to review your personal financial situation and make an informed estimate of your true purchasing power.

Your purchasing power will depend on:

  • Your income
  • Your Credit Rating
  • Other Monthly Expenses
  • Your Down Payment
  • Available Interest Rates

Pre-qualifications vs. Pre-approval

Pre-qualification is only a loan agent’s opinion that you’ll be able to obtain financing. No verifications are made, so formal approval is not issued.

Pre-approval means your loan application has been taken through a rigorous procedure. Pre-approval saves you the time of looking at houses you can’t afford.

Pre-approval buyers are ahead in the home buying game. If you make an offer on a home and then apply for a loan instead of the other way around, you are at the mercy of the lender who now knows you don’t have time to shop around.

A pre-approval letter from a lender will also give you an edge when multiple offers have been made on a house. Pre-approved buyers generally close escrow more quickly, since most of the paperwork has already been taken care of.


Fixed rates are usually structured with repayment terms of 25, 20 or 30 years. With a minimum of 5 percent down the lender will agree to charge a fixed interest rate over the life of the loan. With this loan type, your monthly mortgage payments will remain the same for the length of the term.


To secure an FHA loan, a borrower must apply and qualify with a certified FHA lender. Additionally, eligible borrowers must be able to pay a minimum of 3.5% of a home’s purchase price. If the loan is approved, FHA will ensure a portion of the loan’s value to the lender. Down payment assistance may be available.


Veteran Administration loans are available to qualified Veterans and spouses. Private lending institutions issue the loans which are in turn guaranteed by the Veteran’s Administration. The VA does not require any down payment on VA Guaranteed loans and allows the borrower to receive a competitive, fixed interest rate.

Rural Development

Rural Development loans are determined based on geographical location. Rural Development loans do not require any down payment, and included competitive interest rates. We have several preferred lender contacts who can help you decide on the best lender option. Please contact us for more information.