I’m buying a home, but it’s not my first rodeo.

You’ve successfully purchased a home before – a major confidence boost when deciding to start the process again. As much as the first time buying a home is exciting, the second, third, or even tenth time, gives you a real sense of accomplishment.

With your knowledge of not only the loan process but also of homeownership, this time around you probably know more about what you want in a home, as well as what you can afford. That doesn’t mean you won’t have questions about your loan, it might even prompt more.

As things might have changed since your last home purchase, our professionals at home.com by Homefinity will make sure you have the most current information about what you’ll need to prepare to apply for a loan and close on a new home. We’ve outlined where to start, loan options, and how to secure the most affordable home loan for your situation.

Where to start

Are you ready to apply for a mortgage?

• Know what you want.
  You know what comes with owning a home. Before purchasing a new home, use this knowledge to its full potential. Think about location, layout, features, conditions you would prefer in a new home.
  
  Also, consider affordability. How did the cost of your previous home affect your lifestyle and finances? Can you afford more or less in a home this time? Are you buying a new home because of a change to your lifestyle and how does this change your priorities? 

• Know your finances.
  A refresher course on your credit score and monthly budget can go a long way toward determining how much house you can comfortably afford.
  
  Using a free site like CreditKarma, CreditSesame, or CreditWise can be a quick way to get an idea of how you’re doing with your credit. But, just keep in mind that when you go to qualify for your mortgage we’ll need to request your actual credit report and score, which will give us “official” credit scores and the full details of your credit history.
  
  Review your credit report for accuracy and to see areas that strengthen your chance of securing a lower-cost mortgage or to understand areas where you could improve your score.

• Calculate an affordable down payment.
  This time you have a clear understanding of how your initial down payment affected the cost of your mortgage over time.
  
  Whether you’ve had more time to save for a down payment, or are depending on the sale of your current home to cover the cost of down payment, you’ll want to understand what loan options you’re eligible for before deciding how much home you can afford.
  
  A down payment can range from as low as 3%. If you want to purchase a $300,000 home, that could mean a payment upfront of around $9,000, depending on your loan.
  
  Typically the more you can put down, the cheaper your monthly payments will be. If you put less money down, you may take on higher monthly payments with costs such as mortgage insurance premiums.

• Move at your pace.
  As a repeat homebuyer, you might currently own a home you plan to sell. This would fund a downpayment on your new home. Or if you plan to keep your current home, you might still owe on its mortgage, while taking on a new one. These are major factors that affect the affordability of your new loan and your timing for getting it approved, whether you need to sell and move out of your current home, update your previous home for renters, or can take your time with a move.
  
  Determine a timeline that fits your financial and lifestyle needs. Once you know a reasonable timeline, we can work with you to meet it. The typical timing from application to closing can take about 1 month. Our technology and nationwide professionals can accelerate parts of the process to ensure you have quick approval if needed, and convenient closing.

Do you qualify for special programs?

Even for repeat buyers and buyers at various income levels, there are several special circumstances and government programs that can make your home purchase more affordable. Learn whether you’re currently eligible.

• Special programs, which can lower interest rates and down payments are sometimes available.
• If you’re active duty or a veteran you can use your VA benefit
• If you need a low down-payment an FHA loan might be the best fit

View our Find a Loan page to see if there is a better fit for your situation.

Outside of these specific situations, it’s common for repeat homebuyers to qualify for a conventional loan.  

Is a Conventional loan or an FHA loan your best option?

Conventional

The flexibility of conventional loans make them a common choice for repeat homebuyers. Although a higher credit score is needed to qualify for a conventional loan, it presents several options for determining your down payment, closing costs, monthly payments, and length of your mortgage.

Conventional mortgages meet the down payment and income requirements set by Fannie Mae and Freddie Mac, which help fund the US housing market. Conventional loans also follow limits set by the Federal Housing Finance Administration (FHFA).

Features

• Most common loan for homebuyers
• Down payment as low as 3%
• No out-of-pocket closing cost option
• Choose fixed or adjustable-rate

Term Options

15-Year 

• Stricter credit requirements
• Lower interest rates
• Higher monthly payments
• Paid off faster

30-Year

• Most common among homebuyers
• Lower monthly payments
• Higher interest paid over time, totaling more than twice the cost of a 15-year mortgage

Requirements

• Credit score requirements can fluctuate, but we can typically find an appropriate loan program or assist you in improving your score
• Downpayment of 3% or more, with 5-10% being typical
• Monthly mortgage insurance payments required if down payment is less than 20%, until your loan-to-value ratio reaches 80%
• Depending on location, typically for a loan no larger than $510,400 to $765,600 for a single-family home

FHA 

With federal assistance, we can provide an FHA loan, which allows you to get approved even if you’re a repeat buyer, your first mortgage was FHA, or you have a low income, credit score, or down payment. The Federal Housing Administration provides insurance to make this possible, as loans like this would otherwise be a riskier investment for lenders.

Features

• Repeat homebuyers are eligible
• Down payment as low as 3.5%
• No-closing-cost option
• Gift down payments allowed

Requirements

• Your credit score will determine the down payment amount, ranging from 3.5% – 10%
• Home being purchased will be your primary residence 
• A required home inspection that meets minimum property standards
• A mortgage insurance premium paid at closing and monthly mortgage insurance payments, likely for the life of the loan
• Depending on location, typically for a loan no larger than $314,545 to $726,525 for a single-family home

How does home.com by Homefinity work with you?

Now that you’re up to date on your finances and considerations for buying a home, let’s get familiar with the latest mortgage application process to find what will work specifically for your situation. Homefinity’s professionals will work with you from start to finish to secure the loan you need.

1. With a phone call to our loan professionals or a convenient online form, you can start the application process, where we’ll ask questions about your credit and finances to learn about your needs.
2. Your information helps us make the best possible recommendations on what loan options will work best for you, such as whether you qualify for a 30-year Conventional, 15-year Conventional, or an FHA loan. We’ll discuss the options with you and any questions you have about your situation.
3. Once you feel comfortable with choosing your loan, we’ll help you through the approval process. With approval, we can lock in your interest rate so it won’t fluctuate throughout the process.
4. As you head toward closing your loan, we’ll guide you through every step, updating you at each point in the process with clear details and next steps. Your dedicated loan officer can answer your questions at any time.
5. We work within your timeline to sell your previous home or pay off a previous mortgage. When you’re ready, we can close your loan on the day, time, and place that works best for you.

Get Started. Make it home.

Keep the process simple by connecting with a dedicated loan officer to discuss your options this time around. Apply online or over the phone to start the approval process so that you can feel confident in your loan when buying a new home.