Purchase

 Purchasing a home is a very exciting time, and being well prepared will help you make better decisions. Buying a home offers many advantages, one of the most significant being that it allows you to build equity (ownership). In many cases, mortgage payments can be even less than rent.

 The first step toward finding the right home is to get preapproved. This will enable you to understand your purchasing power and determine how much you can afford to pay each month. This saves you time by allowing you to focus on homes and neighborhoods you can afford. 

If you don't have a big nest egg saved for a down payment, don't worry! There are many different low down payment loan programs available including the 3.5% FHA, 3% conventional loan and 0% down VA loan..  

 The most common type of home loan is the conventional loan. These loans are perfect for borrowers with a strong credit history and the funds for a down payment. Conventional loans have fixed or adjustable rates.  The length of most conventional loans is 15 or 30 years. To qualify, you will need a good credit score. The minimum score to be approved can vary, but a minimum score of 620 is typically what you will need, and a score of 740 will help you secure the best rate possible. 

 A jumbo loan might be your best choice to finance even a modest home in some high-priced housing markets like Southern CA. The benefit to jumbo loans boils down to being able to make larger purchases. Jumbo loans are loan amounts above the conforming loan limits. They typically will require higher income, better credit scores and a higher down payment. 15 or 30 years terms are available.

 FHA loans are a type of home loan that is insured, not by a private financial institution, but by the Federal Housing Administration (FHA). The FHA loan is friendlier to a first time home buyer than many other types of loans as it offers low down payments, will approve lower credit scores and isn't as restrictive on debt ratios as conventional loans.