First Time Home Buyer Archives

Buying your first home is an exciting milestone, but navigating the mortgage process can feel overwhelming. With so many loan options available, it is important to choose one that best suits your financial situation and long-term goals. Here are three of the most popular home loan programs that first-time buyers should consider.

1. FHA Loan: Ideal for Buyers with Lower Credit Scores and Small Down Payments

The Federal Housing Administration (FHA) loan is a popular choice for first-time buyers because of its flexible requirements. FHA loans allow for lower credit scores and smaller down payments, making homeownership more accessible.

Down Payment: As low as 3.5 percent with a credit score of at least 580.
Credit Score Requirements: Borrowers with scores between 500-579 may still qualify with a 10 percent down payment.
Mortgage Insurance: Requires both an upfront and annual mortgage insurance premium (MIP), which increases the overall cost of the loan.
Flexible Debt-to-Income Ratios: Allows higher debt levels compared to conventional loans.

This loan is a great option for buyers who need a lower barrier to entry and are comfortable with paying mortgage insurance over the life of the loan or until refinancing into a conventional loan.

2. Conventional 97 Loan: Low Down Payment with No Upfront Mortgage Insurance

For first-time buyers who want a low down payment without the added cost of upfront mortgage insurance, the Conventional 97 loan backed by Fannie Mae and Freddie Mac is worth considering.

Down Payment: Requires just 3 percent down, making it an attractive alternative to FHA loans.
Credit Score Requirements: Generally requires a minimum score of 620, but better rates are available for scores above 700.
Mortgage Insurance: Private mortgage insurance (PMI) is required but can be removed once 20 percent equity is reached.
No Upfront Mortgage Insurance: Unlike FHA loans, there is no upfront insurance premium, which can save buyers money at closing.

This loan is ideal for buyers with decent credit scores who prefer a conventional loan structure and want to remove PMI once they build enough equity.

3. VA Loan: The Best Option for Eligible Military Members and Veterans

For service members, veterans, and eligible spouses, the VA loan offers unbeatable benefits that make homeownership more affordable.

Down Payment: No down payment required, which helps buyers save cash for other expenses.
Credit Score Requirements: No official minimum score, though most lenders prefer at least 620.
Mortgage Insurance: No private mortgage insurance (PMI) required, lowering monthly costs.
Competitive Interest Rates: VA loans often have lower rates than conventional or FHA loans.
Additional Benefits: Includes limits on closing costs, no prepayment penalties, and support from the VA if financial hardships arise.

For those who qualify, the VA loan is a powerful tool that eliminates many of the financial barriers to homeownership.

Choosing the Right Loan for You

Each loan program has its own advantages and trade-offs. The right option depends on your credit score, financial situation, and long-term goals. Here are some quick considerations to help you decide:

Choose FHA if you have a lower credit score and need a small down payment.
Choose Conventional 97 if you have a higher credit score and want to remove mortgage insurance later.
Choose VA if you are eligible and want the best loan terms with no down payment.

Taking the time to explore these loan options and speaking with a mortgage professional can help you make an informed decision and move forward confidently in your home-buying journey.

Lee Vanvolkenburg

15:43 23 Nov 23

Michael and his team were wonderful to deal with. They were excellent with communication and always available to answer questions. Thank you all!

williams lovos

22:54 16 Nov 23

We close on the house tomorrow! Thank you David and Michael for making my first home buying a smooth process. I had several out of the ordinary situations that would had easily not been possible to get the loan in the time that they were able to approve it. My wife and I are forever grateful for the work the team did. Thank you again!

Mario Silvestri III

16:45 16 Nov 23

Rex Perkins

16:56 15 Nov 23

Everything had been going well over the past two years since refinancing an existing mortgage. The application process, approval, servicing website, everything had been very smooth, nothing but the best service. I then had a minor issue arise. We had a wind loss claim on our home and, unfortunately, I had put off getting the check cosigned until the last minute. An issue arose as part of a minor miscommunication in terms of where the check was to be forwarded for endorsement.To make a long story short, I feared that this miscommunication and misdirected check coupled with my procrastination were going to result in the check expiring and a huge hassle on my part to go through the process again. Mr. Inkman nor his branch were in any way involved with my account or account management, yet, the check inadvertently ended up in their draft loss department and I feared this would further delay things. I was a bit frantic.One of those that I emailed was Mr. Inkman. In an era when customer service is not as valued as in the past, I was very skeptical I would meet the deadline. But, to my surprise, Mr. Inkman took it on his own to personally get things done and get the issue resolved. It appears that he tracked down the overnighted check personally, directed it for signature, packaged and overnighted the check back to me. All the while remaining professional and pleasant and providing consistent email updates on the status. It doesn't even look like he delegated, rather taking the initiative and seeing it through on his own.To me, that's not just doing a job, that's going above and beyond in terms of leadership, professionalism, and customer service. We could not be more happy. And, as a further sign of good will, the Fairway CEO actually emailed me personally to follow-up and assure resolution. Been very happy with Fairway since my refinance, Mr. Inkman's efforts only further reinforce that opinion.

Samer Fallouh

15:01 15 Nov 23

Debbie Salas

21:47 03 Oct 23

This transaction probably would not have happened without Michael. Whenever we hit a stumbling block, he found a way around it! He kept us informed and was a positive light all the way through to the end and beyond.Thanks

Eric Kieffer

22:46 16 Aug 23

Did business with Michael about 20 years ago and he was happy to help us again. He and his team did a great job. See you in another 20.

The Top 3 Home Loan Programs First-Time Buyers Should Consider

Quick Links

Office Location