First Time Home Buyer
Mortgage Guide 2025: Gen Z Edition
Complete guide: Down payment assistance programs ($10K-$25K FREE), affordability calculator, credit requirements, loan types comparison, and top 10 mistakes to avoid. Get pre-approved in 24 hours!
🏠 Get Pre-Approved in 24 Hours
See how much house you can afford. FREE quote in 2 minutes!
Get Pre-Approved NOW →📊 Gen Z Home Buying Boom 2025
- 28% of purchases by first-timers - Up from 24% average
- Gen Z (25-34) dominating - Largest demographic
- Average down payment: 8% - You don't need 20%!
💵 Down Payment Assistance Programs
Get $10K-$25K FREE money! 2,000+ programs nationwide.
🏦 FHA Loans (3.5% Down)
- • Only 3.5% down required
- • 580+ credit score qualifies
- • Gift funds allowed
🎖️ VA Loans (0% Down)
- • $0 down payment!
- • No PMI - save $300/month
- • For veterans & active duty
⚠️ Top 10 Mistakes to AVOID
1. Not Getting Pre-Approved First
Get pre-approved BEFORE house hunting. Takes 24 hours.
2. Maxing Out Your Budget
Stay 10-15% below max to handle unexpected costs.
3. Skipping Home Inspection
$500 inspection saves $50K in hidden repairs.
❓ First-Time Home Buyer FAQ (12 Most Asked Questions)
How much do I need for down payment?
As little as 0-3.5%! FHA: 3.5% ($10,500 on $300K home), VA/USDA: 0%, Conventional: 3-20%. Average first-timer: 8% ($24,000). Use down payment assistance programs to cover most/all of it!
What credit score do I need to buy a house?
FHA: 580+ (3.5% down) or 500-579 (10% down). Conventional: 620+ minimum, 680+ for best rates. VA: No official minimum but lenders prefer 620+. USDA: 640+ recommended. Most first-timers have 650-700 scores.
How long does it take to buy a house?
Average: 3-6 months total. Pre-approval (1-3 days), house hunting (4-8 weeks), offer to closing (30-45 days). Can be faster with pre-approval and motivated sellers. Delays happen with appraisal issues or financing complications.
Can I buy a house with student loan debt?
YES! 83% of first-time buyers have student loans. Lenders count 0.5-1% of loan balance as monthly payment. $50K student loans = $250-500/month in DTI calculation. Income-driven repayment plans help lower this amount.
Should I buy or keep renting?
Buy if: Staying 3+ years, monthly mortgage ≤ rent, have emergency fund, stable income. Rent if: Moving soon, building credit, saving down payment. In 2025, buying often cheaper than renting in 38 states!
What's the difference between pre-qualification and pre-approval?
Pre-qualification: Estimate based on self-reported info (no verification). Pre-approval: Lender verifies income, credit, assets - gives exact loan amount. ALWAYS get pre-approved before house hunting. Takes 1-3 days.
Can I use gift money for down payment?
YES! FHA/Conventional allow 100% gift funds from family. VA allows gifts too. Need gift letter stating it's a gift (not loan). Donor must prove funds came from legitimate source. Can't be from seller or real estate agent.
What are closing costs and how much are they?
Closing costs: 2-5% of home price ($6K-$15K on $300K home). Includes: appraisal ($500-800), title insurance ($1K-2K), origination fee (0.5-1%), inspections, attorney fees. Ask seller to pay or use lender credits.
Should I buy a fixer-upper as first home?
Usually NO. Hidden costs average $50K-$100K. Better: Buy move-in ready, build equity, THEN buy fixer-upper. Exception: FHA 203(k) renovation loan lets you finance repairs into mortgage. Need 15% buffer in budget.
Can I buy a house with my partner if we're not married?
YES! Unmarried couples can co-borrow. Both incomes count, both on title. Risks: Breakup = complicated. Solution: Create co-ownership agreement detailing what happens if you split. Consult real estate attorney ($500-1,000).
What happens if I get denied for a mortgage?
Don't panic! Common reasons: Low credit (fix in 3-6 months), high DTI (pay down debt), insufficient income (add co-borrower), job change (wait 2 years). Lender must tell you why. Fix issues and reapply in 3-6 months.
Is now a good time to buy in 2025?
YES! Rates dropped from 7.8% to 6.3%, inventory up 18%, prices stabilized, sellers paying concessions. Best opportunity since 2021. Waiting for "perfect" time costs you: rent increases 5%/year, home appreciation 4-6%/year, rates may rise again.
Sarah Mitchell
Senior Mortgage Advisor & VA Loan Specialist
Sarah Mitchell brings over 12 years of mortgage industry expertise, specializing in VA loans and first-time homebuyer programs. As a certified NMLS professional, she has helped thousands of veterans and military families achieve homeownership through specialized loan programs. Her deep understanding of VA benefits and down payment assistance programs makes her a trusted advisor for service members transitioning to civilian life.