3 Steps to Getting Approved for a Home Loan

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There are three basic things that lenders consider when you apply for home loans Scottsdale-based: your credit, your income, a down payment, and your debt-to-income ratio. Let’s take a look at each below. 


Credit plays a major role in the approval and denial of home loans. Most lenders want to see a credit score of at least 620, though some require higher. Fortunately, there are specific types of loans, such as FHA and USDA loans, that accept much lower credit scores. 

Typically, however, nothing lower than a 500 is accepted. Keep in mind, though, that your credit score will have a direct impact on your interest rate. The higher you can get your score before applying, the less you’ll pay for the house. 


Most lenders want to see steady income for at least two years, but that’s not the only part of your income that matters. They also look at your debt-to-income ratio, which is how much you have coming in compared to how much you have going out. This helps ensure you can make the necessary monthly payments. 

Down Payment 

The amount you can put down will also factor into the equation, but the amount you need depends on the loan and your credit. For example, some lenders require 20 percent if your score is under 620. Some require as little as 3.5 percent. And then some, like VA loans, require no down payment at all. 

It’s important to consider, though, that the less you pay down, the more you have to borrow. Even if you’re not required to pay a down payment, it’s always good to pay anything you can to lower your loan balance.