Frequently Asked Questions about Buying Your First Home
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Lenders look at the overall debt-to-income ratio. They like to see that your monthly housing payment, plus everything on your credit report (including car payment, credit cards, etc.), is not more than 50% of your total gross monthly income (before taxes).

If you want to buy a $100,000 home, the monthly payment will be $1,000. Suppose you also pay another $500 each month in other bills that are on your credit report. That’s a monthly debt of $1,500. You would need to earn about twice that, or $3,000 a month, to qualify for the home loan, typically.

What type of credit do I need to have?

For an FHA loan, which is very popular, buyers generally need to have clean credit for the past 12 months, meaning that payments have been made on time. Many lenders don’t worry about credit problems that took place in the past, as long as the past year is good and clean.

What if I don’t have other loans or credit cards?

The FHA and other lenders are very willing to consider what they call “alternate lines of credit.” That is, any type of payment history that shows that the buyer is able to make regular payments on time. These can include items such as rent, utilities, telephone, car insurance and child-care payments. If a buyer can show clean, 12-month payment histories for at least 3 of these types of alternate lines of credit, that is generally good enough.

About The Author Damon Thomas is a contributor to www.casanuevahouston.com, a Houston-based company providing information for new home buyers.

Frequently Asked Questions about Buying Your First Home
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Additional Resources

category - Home Buying Programs

Government Grants within the United States Housing Sector
The government has established quite a slew of agencies that are specifically designed to administer housing programs and assist the needs of homebuyers, renters, and property developers.

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Rehabilitation Mortgage Insurance Program
The Department of Housing and Urban Development, otherwise known as HUD, is a Cabinet department in the executive branch of the United States federal government.

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Rehabilitation Mortgage Insurance Program
The Rehabilitation Mortgage Insurance Program intends to financially assist families as they repair or improve, purchase and improve, or refinance and improve their current residential properties that have been existent for more than a year.

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First Time Homebuyer Programs in New Hampshire
The State of New Hampshire gives great importance to the welfare and safety of its people. One of the ways of showing this is through the establishment of the New Hampshire Housing Finance Authority, which is specially designed to assist low to moderate income residents of New Hampshire in the process of procuring safe and affordable housing opportunities.

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