Mortgage payments guide
Easy Steps to Get a Mortgage
Getting a mortgage can feel intimidating the first time around, but the process is more predictable than it looks. Lenders follow the same playbook on almost every loan, so once you understand the order of operations you can move through it without surprises. This guide walks through the eight steps most buyers take, from the first credit check to the keys in your hand. Use it alongside our Mortgage Calculator to keep your numbers grounded the whole way.
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1. Check your credit and finances
Before talking to any lender, pull your free credit reports and look up your score. Most conventional loans want a score of 620 or higher; FHA loans can go lower, sometimes into the 500s with a larger down payment. Higher scores unlock better rates — the difference between a 680 and a 760 score can be a meaningful chunk of your monthly payment.
At the same time, tally your monthly debts, income and savings. Lenders care about debt-to-income ratio (DTI), and most prefer to see total DTI at or under 43%. If your numbers are tight, you have a few months to pay down credit cards or boost savings before applying.
2. Set a realistic budget
Your maximum loan amount is not the same as the home you should actually buy. Aim for a payment — principal, interest, taxes, insurance and HOA — that fits comfortably inside your take-home pay, with room left for maintenance, utilities and life.
A common rule of thumb is to keep housing costs at or below 28% of gross monthly income. Run a few scenarios in our Mortgage Calculator with different home prices and down payments to see what each one really costs per month.
3. Build your down payment and reserves
You don't need 20% down to buy, but the size of your down payment changes nearly everything: your interest rate, your monthly payment and whether you'll pay private mortgage insurance (PMI). Conventional loans can start at 3% down; FHA at 3.5%; VA and USDA can go to zero for eligible buyers.
Lenders will also want to see reserves — money left in the bank after closing — usually enough to cover 2 to 6 months of payments. Don't drain every account to maximize the down payment; reserves are what keep you out of trouble in the first year.
4. Get pre-approved
Pre-approval is a written estimate from a lender saying how much they'd likely lend you, based on a verified look at your income, assets, debts and credit. It's stronger than pre-qualification, which is just a soft estimate.
It's worth getting pre-approved with two or three lenders within a 14- to 45-day window so the credit pulls count as a single inquiry. Sellers in most markets won't take an offer seriously without a pre-approval letter in hand.
5. Shop lenders and compare offers
Rates and fees vary more than people expect. Get formal Loan Estimates from at least three lenders and compare them side by side. Look at the interest rate, the APR (which folds in fees), origination charges, discount points and the cash you need to close.
Don't just look at the rate. A lender quoting a quarter-point lower but charging $4,000 in extra fees may cost you more in the first few years than a slightly higher-rate competitor.
6. Submit your full application
Once you've chosen a lender and have a property under contract, you submit a full mortgage application. Expect to provide pay stubs, W-2s or tax returns, bank statements, ID, the signed purchase agreement, and explanations for any large or unusual deposits.
You'll also receive your official Loan Estimate within three business days. Read it carefully — this is the document that locks the lender's quote into a concrete set of numbers.
7. Appraisal and underwriting
The lender orders an appraisal to confirm the home is worth at least the price you've agreed to pay. At the same time, an underwriter pores over your financial documents and the property paperwork, often asking follow-up questions through your loan officer.
During this stretch, avoid anything that changes your financial picture: don't open new credit cards, change jobs, finance furniture or move large sums between accounts. Any of those can delay or derail your approval.
8. Close on your loan
Three business days before closing, you'll get a Closing Disclosure that mirrors the Loan Estimate. Compare the two — the numbers should be very close. Bring a cashier's check or wire for your closing costs and down payment, your ID, and any documents your lender asks for.
At the closing table you'll sign the promissory note, the mortgage or deed of trust and a stack of disclosures. Once everything is signed and funds are sent, the property — and the loan — are officially yours.
Frequently asked questions
- How long does it take to get a mortgage from start to finish?
- Most buyers go from application to closing in 30 to 45 days, though pre-approval can be done in a few days and shopping for a home can take anywhere from weeks to many months. Refinances are often a bit faster than purchase loans because no seller, agent or appraisal timeline is in play.
- What credit score do I need to get a mortgage?
- For a conventional loan, lenders typically want at least 620. FHA loans can go down to 580 with 3.5% down, or 500 with 10% down. VA and USDA loans don't set a hard floor but most lenders look for 620+. Higher scores get noticeably better rates, especially above 740.
- How much do I need for a down payment?
- It depends on the loan. Conventional loans can start at 3% down for first-time buyers, FHA at 3.5%, and VA or USDA at 0% for eligible borrowers. Putting 20% down lets you avoid PMI on a conventional loan, but it isn't required to buy a home.
- What's the difference between pre-qualification and pre-approval?
- Pre-qualification is a quick, informal estimate based on numbers you self-report. Pre-approval is a written commitment from a lender after they verify your income, assets, debts and credit. Sellers and agents take pre-approval far more seriously, especially in competitive markets.
- Will shopping multiple lenders hurt my credit score?
- Not significantly. Credit scoring models treat multiple mortgage inquiries within a 14- to 45-day window as a single event, so you can compare offers from several lenders without taking repeated hits. The small temporary dip is usually outweighed by getting a better rate.
- What documents will the lender ask for?
- Expect to provide a government-issued ID, two years of W-2s or tax returns, your two most recent pay stubs, two months of bank and investment statements, proof of any other income, and the purchase contract. Self-employed borrowers may need profit-and-loss statements and additional tax documentation.
- What is PMI and how do I avoid it?
- Private mortgage insurance protects the lender if you stop paying, and it's typically required on conventional loans when your down payment is below 20%. You can avoid it by putting 20% down, choosing a lender-paid PMI structure, or using a piggyback loan. On conventional loans, PMI usually drops off automatically once you reach 22% equity.
- What should I avoid doing between pre-approval and closing?
- Don't open new credit cards, finance a car, take on new loans, change jobs, or make large unexplained deposits or withdrawals. Underwriters re-verify your credit and finances right before closing, and any surprise can delay funding or void your approval entirely.