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Your Journey to Homeownership Starts Here
Whether you're just starting to explore or ready to get pre-approved, we'll help you find the right loan, navigate down payment options, and close with confidence. No jargon. No pressure. Just a team that's helped thousands of first-time buyers just like you.
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No tax returns required to explore options. No impact to your credit.
Ready to See What You Qualify For?
No tax returns required to explore options. No impact to your credit.
First-Time Home Buyer at a Glance
This guide simplifies the path to homeownership by outlining credit requirements, down payment options, and key timelines.
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What credit score do I need?
580+ (FHA), and 620+ (Conventional)
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Required down payment?
0% (VA/USDA), 3% (Conventional), 3.5% (FHA)
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Can I buy with student loans?
Yes — we calculate your DTI to find the best options
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Timeline & first step?
24h pre-approval. 25–35d close. 1st: free pre-approval.
What Qualifies as a "First-Time Home Buyer"?
You might be surprised to learn that "first-time home buyer" doesn't always mean you've never owned a home.
According to most lender and government program definitions, you're considered a first-time buyer if:
You've never owned a home before
You haven't owned a home in the past 3 years
You're a single parent who only owned a home with a former spouse
You're a displaced homemaker who only owned a home with a spouse
You've only owned a property that wasn't permanently affixed (like a mobile home not on a permanent foundation)
Why this matters: If you owned a home years ago but have been renting recently, you may still qualify for first-time buyer programs, grants, and down payment assistance. Don't assume you're ineligible — let's look at your situation together.
Loan Programs for First-Time Home Buyers
Not all mortgages are created equal. As a first-time buyer, you have access to several loan programs — each with different requirements, benefits, and trade-offs. Here's how they compare:
Conventional Loans
Buyers with good credit (620+) and stable income who want flexibility.
Key features:
- Down payment from 3% (first-time buyer programs)
- PMI required if <20% down, removable later
- Flexible property types and loan amounts
- Competitive rates for qualified borrowers
FHA Home Loans
Buyers with lower credit scores, limited savings, or higher debt-to-income ratios.
Key features:
- Down payment as low as 3.5% (580+ credit score)
- More flexible with credit challenges
- Gift funds allowed for full down payment
- Mortgage insurance required for most loans
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VA Home Loans
Active military, veterans, and eligible surviving spouses.
Key features:
- Zero down payment required
- No private mortgage insurance (PMI)
- Competitive interest rates
- Limited closing costs
- Limited closing costs
- Zero down payment required
USDA Home Loans
Buyers purchasing in eligible rural and suburban areas with moderate income.
Key features:
- Zero down payment required
- Low mortgage insurance costs
- Below-market interest rates
Not Sure Which Loan Is Right for You?
Every buyer's situation is unique. Your credit score, savings, income, location, and goals all factor in. The best way to find your ideal loan is to talk with a specialist who can review your complete picture.
Down Payment for First-Time Buyers — Options, Assistance & Myths
One of the biggest hurdles first-time buyers face is the down payment. But here's the truth: you don't need 20% down to buy a home.
How Much Down Payment Do You Really Need?
| Loan Type | Min. Down Payment | On a $500,000 Home |
|---|---|---|
| VA | 0% | $0 |
| USDA | 0% | $0 |
| FHA | 3.5% | $17,500 |
| Conventional (first-time buyer) | 3% | $15,000 |
| Conventional (standard) | 5% | $25,000 |
The 20% myth: Putting 20% down avoids mortgage insurance, but it's not required. Most first-time buyers put down far less. The key is finding the right balance between down payment, monthly payment, and cash reserves.
Down Payment Assistance Programs
California offers several programs to help first-time buyers cover the down payment:
CalHFA MyHome
Deferred-payment junior loan up to 3.5% of the purchase price for down payment or closing costs.
CalHFA ZIP
Zero-interest program that provides up to 3% of the loan amount, with no payments required until you sell, refinance, or pay off the first mortgage.
California Dream For All
Shared appreciation loan covering up to 20% of the home price — no monthly payments, repaid when you sell or refinance.
Local city/county programs
Many cities and counties in California offer additional grants or forgivable loans for first-time buyers. Eligibility varies by location and income.
Can I Buy a Home with No Money Down?
Yes, in certain situations:
VA loans
Available to eligible veterans and active-duty service members — no down payment required.
USDA loans
For homes in eligible rural and suburban areas — no down payment required.
Down payment assistance
Programs like CalHFA and local grants can cover your entire down payment.
Gift funds
Many loan programs allow your full down payment to come from a family gift.
The First-Time Home Buying Process — Step by Step
Buying your first home doesn't have to be confusing. Here's exactly what to expect, from start to keys-in-hand.
Before you start shopping, take stock of your finances:
- Review your credit score (you can check for free at AnnualCreditReport.com)
- Calculate your monthly debt payments
- Determine how much you've saved for down payment and closing costs
- Gather recent pay stubs, tax returns, and bank statements
Pro tip: Don't open new credit accounts or make large purchases before or during the mortgage process.
The First-Time Home Requirements
Every lender has requirements, but here's what matters most for first-time buyers:
Credit Score Requirement
FHA:
- 580 (3.5% down) / 500 (10% down)
- Ideal 620+
Conventional:
- 620
- Ideal 740+
VA:
- No official minimum
- Ideal 620+
USDA:
- 640
- Ideal 680+
Documentation Checklist
- Government-issued photo ID
- Social Security number
- Pay stubs (most recent 30 days)
- W-2s (past 2 years)
- Federal tax returns (past 2 years)
- Bank statements (past 2-3 months)
- Proof of any gift funds (if applicable)
- Landlord contact info (for rental verification)
Debt-to-Income Ratio (DTI)
Your DTI compares your monthly debt payments to your gross monthly income.
Conventional - 43-45%
FHA - 43-50%
VA - 41% (can exceed with compensating factors)
Example: If you earn $7,000/month and your debts (including future mortgage) total $3,000/month, your DTI is 43%.
Student loans, car payments, credit cards — they all count. We'll calculate your DTI and show you exactly where you stand.
First-Time Home Buyer Costs — Beyond the Down Payment
Closing Costs
Closing costs typically range from 2% to 5% of the loan amount.
On a $500,000 loan: Expect roughly $10,000-$25,000 in closing costs.
Ways to reduce closing costs:
Negotiate seller credits (seller pays part of your costs)
Ask about lender credits
Use down payment assistance programs that cover closing costs
Compare loan estimates from multiple lenders
Ongoing Monthly Costs
Your monthly mortgage payment includes:
Remember: Budget for maintenance, repairs, and utilities beyond your mortgage payment.
First-Time Home Buyer Mistakes — And How to Avoid Them
We've seen thousands of first-time buyers. Here are the mistakes that trip people up:
Shopping for homes without pre-approval wastes time and weakens your offers. Get pre-approved before you tour homes.
Ready to Take the First Step?
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