May 17, 2022

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First-Time Home Buyer Tools You Should Know

Is your credit ready for an FHA loan?

Are you buying a home for the first time? Are you buying a home after a long gap in home ownership? There are some consumer tools you should know about that can help you get closer to owning your dream home.

And not all these tools are for the planning and saving stages of the loan. For example, when house hunting, if you find a home you want, do you know how much your monthly mortgage payment will be?

You can use online mortgage calculators that can help. But that’s a common mortgage tool–what about other options?

Credit Issues

Borrowers who need to work on their credit might be surprised to learn that they can repair their own credit AND get advice on improving credit on a do-it-yourself basis.

Did you know the three major credit reporting agencies (Experian, TransUnion, Equifax) all have consumer education tools about fixing your own credit?

Furthermore, some credit reporting agencies offer fair credit and bad credit help in the form of credit card matching programs.

These are specifically designed to help people trying to improve their credit scores. But don’t delay in repairing your credit. Get started long before you consider filling out paperwork to apply for your  home loan. Credit repair takes time.

Down Payment Assistance

Sometimes the issue isn’t so much about credit scores as they are making their down payment. Many have the option to apply for down payment grants.

Often aimed at first-time home buyers, and also at borrowers who have had no ownership in a principal residence in the last three years, you can qualify for a down payment grant on other cases too. For the purpose of these programs, more people may technically count as first-time buyers:

  • Single parents (who only owned a home with a former spouse);
  • Displaced homemakers who only owned property w/a spouse.
  • Those who owned property that was not permanently fixed to a permanent foundation;
  • Those who only owned a property not deemed “in compliance” with building code and cannot be brought into compliance for less than the cost of a permanent structure.

Your down payment assistance must meet sourcing requirements including no down payment funds coming from payday loans or non-collateralized lending.

Your loan officer will ask for a letter or written statement from the gift giver that explains the source of the funds in detail–or as much detail as the lender requires. Be sure to ask before accepting gift funds, as documentation is a critically important part of this process.

And finally, borrowers can also take advantage of an option offered via the FHA official site; can call the FHA at 1-800 CALL FHA to request a referral to a local, HUD-approved housing counselor who can help you plan your loan. 

Joe Wallace - Staff Writer

By Joe Wallace

April 27, 2021

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for for (8) years and is currently the Associate Editor for

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About was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

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