Buying Your First Home? Here's What Actually Matters.
After 23 years of helping first-time buyers close on their homes, I've learned that the biggest hurdle isn't your credit score or your down payment — it's confusion. Let me clear it up.
What I Wish Every First-Time Buyer Knew Before Starting
I've helped hundreds of first-time buyers get into their homes over the past two decades. Some came to me thinking they needed 20% down (they didn't). Some thought their credit score was too low (it often wasn't). And a surprising number had no idea that down payment assistance programs exist that could cover most or all of their upfront costs.
Here's the reality: buying your first home is more accessible than you think, but only if you understand your options. And your options vary depending on your credit score, your income, where you're buying, and whether you have military service. That's exactly what I help people sort through every day from our office in Gilbert, Arizona.
The biggest mistake I see first-time buyers make isn't picking the wrong loan — it's waiting too long because they assumed they didn't qualify. Let's figure out where you actually stand.
Loan Programs for First-Time Buyers
There's no single "first-time buyer loan." There are several programs, each designed for different situations. Here's how I think about which one fits.
FHA
3.5% down · 580+ credit
- 3.5% down (entire amount can be gifted)
- 580 credit score minimum (500 with 10% down)
- Higher DTI tolerance (up to 50%+)
- Mortgage insurance for life of loan
- Compatible with most DPA programs
- Full FHA details
Conventional 97
3% down · 620+ credit
- 3% down payment
- 620+ credit score required
- PMI cancels at 80% LTV
- No upfront mortgage insurance fee
- Better long-term cost with good credit
- Full conventional details
VA
$0 down · Veterans
- Zero down payment required
- No monthly mortgage insurance
- No VA minimum credit score
- Funding fee (may be exempt if disabled)
- Must be veteran, active duty, or surviving spouse
- Full VA details
HomeReady / Home Possible
3% down · Income limits
- 3% down from Fannie Mae or Freddie Mac
- Reduced mortgage insurance pricing
- Income must be at or below area median
- Non-occupant co-borrower income allowed
- Boarder income may count (HomeReady)
- PMI cancels at 80% LTV
Which Loan Program Is Best for Your Situation?
I run this comparison for every first-time buyer I work with. The right program depends on your specific numbers — not on which one sounds best in a blog post. Here's a side-by-side overview, and then I'll tell you how I actually think about this decision.
| Factor | FHA | Conv. 97 | VA | HomeReady |
|---|---|---|---|---|
| Min. down payment | 3.5% | 3% | $0 | 3% |
| Credit score (practical) | 580–620+ | 620–680+ | 580–620+ | 620+ |
| Monthly MI | 0.55% (life of loan) | Varies (cancels at 80%) | None | Reduced (cancels at 80%) |
| Upfront fee | 1.75% UFMIP | None | 2.15% funding fee | None |
| Gift funds for down payment | 100% allowed | Allowed (some restrictions) | N/A ($0 down) | 100% allowed |
| DPA compatible | Yes | Yes | N/A | Yes |
| Income limits | None | None | None | Area median income |
How I actually decide: If you're a veteran, VA is almost always the starting point — zero down and no MI is hard to beat. If you're not VA-eligible and your credit is below 680, FHA is usually the most forgiving path. If your credit is 700+ and you have at least 3% to 5% down, conventional (with or without HomeReady) typically costs less over time because the MI cancels. And if you're near the area median income limit, HomeReady's reduced MI pricing can save you real money. I model all of these scenarios for every borrower — because the right answer is the one with the lowest total cost, and that's only clear when you see the actual numbers side by side.
Arizona Down Payment Assistance Programs
This is where a lot of first-time buyers get excited — and where having a broker who knows these programs inside and out makes a real difference. Arizona has several active DPA programs, and I've helped borrowers layer them on top of FHA and conventional loans to dramatically reduce their out-of-pocket costs. Here are the main ones:
HOME Plus (Arizona IDA) — Statewide
The HOME Plus program is administered by the Arizona Industrial Development Authority and is available in every county, city, and zip code in Arizona. It combines a 30-year fixed-rate first mortgage with DPA of up to 5% of the loan amount. The DPA is structured as a silent second mortgage — no interest, no monthly payments, and it's forgiven over the first five years of homeownership. If you stay in the home for five years, the DPA is completely forgiven.
- Borrower income must not exceed $112,785
- At least one borrower must complete a homebuyer education course
- Available for FHA, VA, and conventional first mortgages
- Military members (active and veterans) may qualify for an additional 1% DPA
- No first-time buyer requirement for most HOME Plus programs
Home in Five Advantage — Maricopa County
If you're buying in Maricopa County (that includes Gilbert, Mesa, Chandler, Scottsdale, Tempe, and Phoenix), the Home in Five Advantage program is one of the most generous DPA programs I've worked with. It provides 3% to 6% of the loan amount as down payment and closing cost assistance, structured as a forgivable second mortgage that's forgiven after 84 months (seven years).
- DPA options of 3%, 4%, 5%, or 6% — the higher the assistance, the slightly higher the first mortgage rate
- Additional 1% for veterans, active military, reservists, National Guard, first responders, and teachers
- Compatible with FHA, VA, Fannie Mae HFA Preferred, and Freddie Mac HFA Advantage loans
- No first-time buyer requirement
- Interest-free, no payments, forgiven at month 84
Real Scenario: Combining DPA With an FHA Loan
I recently helped a first-time buyer in Mesa purchase a $370,000 home using an FHA loan paired with the Home in Five Advantage program at 5% DPA. The 5% DPA covered the entire 3.5% down payment ($12,950) plus a significant portion of closing costs. The buyer's actual cash out of pocket at closing was under $2,000 — mostly prepaid items. That's a $370,000 home with less than $2,000 out of pocket. That's not a hypothetical — it's what this program does when structured correctly.
Arizona Is Home — Maricopa and Pima Counties
The Arizona Is Home program through the state Department of Housing provides DPA for buyers at or below 120% of the area median income. This one does require first-time buyer status (no homeownership in the past three years). The DPA is structured as a silent second mortgage that's due upon sale if you sell before the loan term ends.
There are also local programs in Tucson/Pima County, the IDA grant program (up to $15,000 in Maricopa County for eligible buyers), and others that come and go as funding cycles change. I stay current on all of them so you don't have to.
The First-Time Buyer Process: What to Expect Step by Step
Buying a home for the first time can feel overwhelming because everything is new. Here's how I structure the process so there are no surprises:
Step 1: Let's Talk Before You Start Looking
The most important conversation happens before you step foot in a single open house. I need to understand your income, your debts, your credit, and your savings. I'll pull your credit, review your documents, and tell you exactly what you qualify for — not a rough estimate, but an actual number I'm confident in. This pre-underwrite process takes a few days, and it's the foundation of everything that follows. Start here.
Step 2: Choose Your Loan Program and Lock in DPA
Based on your financial picture, I'll show you which programs you qualify for (FHA, conventional, VA, HomeReady) and which DPA programs are available in your area. I'll run the numbers on each scenario and show you the monthly payment, total costs, and out-of-pocket requirements side by side. You choose. I execute.
Step 3: Shop With Confidence
With a thorough pre-approval in hand, you and your real estate agent can shop with confidence. Sellers take your offer more seriously when the pre-approval is backed by a broker who's actually reviewed your file — not one who spent five minutes on a phone call and printed a letter. If you need a referral to a good agent in the Arizona or Orange County market, I have trusted partners I can connect you with.
Step 4: Under Contract to Closing
Once your offer is accepted, I submit your full loan package to the lender within 24 to 48 hours. The appraisal gets ordered. Underwriting reviews the file. Because I pre-underwrote everything, we typically get a clean approval or a short list of routine conditions. I coordinate all documentation, communicate with the title company, and make sure we close on time. Most first-time buyer purchases close in 30 to 45 days from contract.
Step 5: Closing Day
You'll review your closing disclosure at least three business days before closing (required by federal regulation). I walk you through every number so there are no surprises at the table. You sign, the title company records the deed, and you get the keys. That's it. You're a homeowner.
Mistakes I See First-Time Buyers Make (and How to Avoid Them)
I've been doing this long enough to see the same mistakes repeat. Here are the ones that cost people the most time and money:
Waiting Until You Think You're "Ready"
I can't tell you how many people I've talked to who spent two extra years renting because they thought they needed 20% down or a 750 credit score. Many first-time buyers qualify right now and don't know it. The cost of waiting — in rising rents, rising home prices, and missed equity — is real. At minimum, get a pre-approval so you know where you stand. There's no commitment, no cost, and no obligation.
Not Getting Pre-Approved Before Shopping
Looking at houses before you know what you qualify for is like shopping without knowing your budget. It leads to disappointment, wasted time, and — in competitive markets — lost offers because you couldn't move fast enough. Get pre-approved first. Always.
Making Large Deposits or Purchases During the Loan Process
Once your loan is in process, don't make large deposits into your bank accounts, don't open new credit cards, don't finance a car, and don't change jobs if you can help it. Every one of these things triggers an underwriting condition that can delay or jeopardize your closing. I give every borrower a detailed list of "do's and don'ts" at the start of the process.
Ignoring Down Payment Assistance
Too many buyers don't know about DPA programs, and too many loan officers don't bother to mention them. In Arizona alone, programs like HOME Plus and Home in Five can provide 3% to 6% of your loan amount toward down payment and closing costs — often as a forgivable grant. If you meet the income limits, there's no reason not to use these programs.
Going to a Bank Instead of a Broker
A bank can only offer you their own products at their own pricing. A mortgage broker shops dozens of lenders and finds the one that fits your specific profile. For first-time buyers — who often have unique challenges like lower credit scores, gifted down payments, or DPA layering — the broker model is especially valuable because different lenders have very different appetites for these scenarios.
What Working With The Starks Team Looks Like
First-time buyers need more than a loan — they need someone who explains every step without talking down to them.
Thorough Pre-Underwrite
I don't issue pre-approval letters based on a quick phone call. I review your full file before you start shopping so there are no surprises when you go under contract.
Side-by-Side Comparisons
FHA vs. conventional vs. VA vs. HomeReady — I run every scenario and show you the actual monthly payments and total costs so you can make an informed decision.
DPA Program Expertise
I know which Arizona down payment assistance programs you qualify for, which lenders accept them, and how to layer them for maximum benefit. This isn't generic advice — it's hands-on execution.
Direct Access to Me
You won't get passed around to a call center or a junior processor. I'm a 23-year veteran broker and I handle your loan personally. Questions? Call me directly.
First-Time Buyer FAQs
The questions I get asked most by first-time buyers — answered honestly.
It depends on the loan program. FHA requires 3.5% down (which can be entirely gifted). Conventional loans start at 3% down with programs like Conventional 97 or HomeReady. VA loans require zero down for eligible veterans. And several Arizona down payment assistance programs can cover some or all of your down payment with grants or forgivable second mortgages. On a $350,000 home, 3.5% down is $12,250 — but with DPA, your actual out-of-pocket cost could be significantly less. Use our mortgage calculator to estimate your payment.
For FHA, the guideline minimum is 580 with 3.5% down (or 500 with 10% down), though most lenders want 620 or higher. Conventional loans typically require 620 to 680 depending on the program and lender. VA has no minimum score from the VA itself, but lenders usually want 580 to 620. As a broker, I work with lenders across the credit spectrum — if your score is above 580, we likely have options. If it's below that, I can help you build a realistic plan to get there.
Down payment assistance programs provide grants or forgivable loans to help cover your down payment and closing costs. In Arizona, the HOME Plus program offers up to 5% DPA as a forgivable second mortgage with no interest or payments — forgiven over five years. The Home in Five Advantage program in Maricopa County offers 3% to 6% DPA forgiven after seven years. Eligibility is based on income limits, property location, and completing a homebuyer education course. Most programs do not require you to be a first-time buyer. I can tell you which programs you qualify for in about fifteen minutes.
Not always. Under HUD's definition, a "first-time home buyer" is someone who hasn't owned a home in the past three years. So if you owned a home five years ago and sold it, you qualify as a first-time buyer for federal program purposes. Several Arizona DPA programs, including HOME Plus and Home in Five, don't require first-time buyer status at all — they're available to anyone who meets the income and purchase price limits.
It depends on your credit score, down payment, and how long you plan to keep the loan. If your credit score is below 680, your DTI is higher, or your entire down payment is gifted, FHA is usually the better path. If your score is above 700 and you have at least 5% down, conventional may cost less over time because the mortgage insurance cancels at 80% LTV — unlike FHA where it stays for the life of the loan. I run both scenarios for every first-time buyer and show you the actual monthly payment and total cost comparison side by side. The numbers tell the story.
From the moment you contact me to closing day, the typical timeline is 45 to 75 days. The pre-approval process takes a few days (I pre-underwrite every file thoroughly). Shopping for a home can take a few weeks depending on your market and inventory. Once you're under contract, closing typically takes 30 to 45 days. The entire process moves faster when you're fully pre-approved before you start looking — which is why I always recommend reaching out before you start attending open houses.
Yes, and this is one of the most common strategies I see with first-time buyers. FHA allows 100% of the down payment to come from a gift — a parent, sibling, employer, or charitable organization. Conventional loans also allow gift funds, though some programs require a small borrower contribution from your own funds. VA requires no down payment at all. The key is documenting the gift properly: we need a gift letter and a paper trail showing the funds moving from the donor's account to yours. I walk every borrower through this process to make sure the documentation satisfies the underwriter.
Buying Your First Home Shouldn't Feel This Complicated
Tell me about your situation — your income, your credit, your savings — and I'll tell you exactly what you qualify for. No cost, no obligation, no sales pitch. Just answers.