Mortgage and Financing Resources

Down Payment Assistance

Down-payment assistance programs may help eligible buyers with upfront home-buying costs. Explore the following resources based on where you plan to buy.

Kentucky Resources

• Louisville Metro – Information Center
• Kentucky Housing Corporation (KHC)
• Home Ownership Assistance Program: Kentucky
• Louisville Urban League
• Louisville Affordable Housing Trust Funds (LAHTF)
• U.S. Bank – American Dream Program
• First Financial Bank – Dream Builder
• Right at Home – Stock Yards Mortgage

Florida Resources

• Florida Down Payment Resource
• Hillsborough County Down Payment Assistance
• Homeownership Assistance Program: Florida
• Bank of America Down Payment Programs
• City of Tampa Housing Programs
• Suncoast Housing Connections
• City of St. Petersburg Purchase Assistance Program
• Miami First-Time Homebuyer Program
• Miami-Dade Affordable Homeownership Program

Mortgage Unique Products

ITIN Mortgage Resources

• First National Bank of America – ITIN mortgages (nationwide)
• ACC Mortgage – ITIN program (Florida)
• Acra Lending – ITIN program (Kentucky and Florida)

Foreign National Mortgage Resources

• A&D Mortgage – Foreign National program (Florida)

Credit-Challenge Mortgage Resources

• Mortgage after bankruptcy or foreclosure – First National Bank of America (nationwide)
• 500 credit-score lending resource – Carrington Mortgage Servicing (Kentucky and Florida)
• 580 credit FHA lending resource – Northstar Financing (Florida)

Educational Videos

• Renting vs. Buying a House in the United States Now
• Money Assistance to Buy a Home in Tampa, Florida
• Requirements for FHA Mortgage Loans
• Should You Have Your Home Inspected Before Listing It for Sale?
• Watch more videos from Dolly’s channel
• Watch more videos from Romi’s channel

Steps to Buying a Home

1. Find an Agent

Your real estate professional helps you begin the process and can connect you with lending resources. They can help you navigate the many steps involved in a home purchase.

2. Get Pre-Approved

Before scheduling showings, understand what you may be able to afford based on a lender’s review of your financial profile.

3. Start Your Home Search

Narrow your home search based on your needs, budget, and preferred areas, then begin visiting the homes that interest you.

4. Make an Offer

After finding the right home, you can present an offer to the seller. The seller may accept, counteroffer, or decline. Keep a level head, understand the terms, and rely on your REALTOR® for guidance throughout negotiations.

Once an offer is accepted, earnest money is typically deposited into an escrow account. It is important to understand the timelines and contingencies included in your contract.

5. Home Inspection

It is often helpful to attend the home inspection and ask questions. During the inspection period, buyers may be able to negotiate certain findings according to the contract.

6. Appraisal Ordered

After the inspection contingency is completed, the lender may order an appraisal to evaluate whether the property supports the purchase price and financing amount.

7. Choose Your Homeowners Insurance

Compare homeowners-insurance options and select coverage that fits your needs and budget.

8. Set Up Utilities

Once you have a confirmed closing date, arrange for utilities such as electricity, water, internet, television, and home-security services as needed.

9. Final Walk-Through

After underwriting is complete and you receive clear-to-close status, schedule a final walk-through, commonly the day before or the day of closing.

10. Closing

At closing, ownership is transferred and closing costs are handled according to the purchase contract and loan terms. Buyer closing costs can vary based on the transaction, loan program, and location.

11. After Closing

Keep a home-maintenance checklist and address routine maintenance throughout the year to help protect your investment.

Mortgage Fundamentals

Mortgage Amount

The mortgage amount is the principal of the loan: the amount borrowed to purchase or refinance a home. For a purchase, it is generally the purchase price minus the down payment. For example, a $750,000 purchase with a $37,500 down payment results in a $712,500 mortgage amount.

Interest Rate

Interest is the financial cost charged by a lender for borrowing money. A portion of each monthly mortgage payment goes toward interest. Rates are expressed as a percentage and can be affected by market conditions, loan-to-value ratio, credit score, and mortgage program.

Loan Term

The loan term is the scheduled length of time to repay the mortgage. Common terms include 15 and 30 years. The term affects the monthly payment and the total interest paid over the life of the loan.

Mortgage Payments

Your mortgage payment is the monthly amount due to the lender. In most cases, it includes principal and interest, and it may also include escrowed taxes, insurance, and mortgage insurance when applicable.

Mortgage Escrow Account

A lender may establish an escrow account that collects part of your monthly payment to cover homeownership expenses such as property taxes, homeowners insurance, and private mortgage insurance.

Fixed-Rate Mortgages

A fixed-rate mortgage keeps the same interest rate and principal-and-interest payment for the life of the loan. Your total monthly payment may still change if taxes or insurance change.

Adjustable-Rate Mortgages (ARMs)

An adjustable-rate mortgage has an interest rate that can change over time based on market conditions. ARMs may begin with a lower initial rate than fixed-rate mortgages, but borrowers should understand when and how the rate may adjust.

Home Equity

Home equity is your financial interest in a property: its current market value minus mortgage balances, liens, and other claims attached to it.

Loan Types and Qualification Concepts

Conforming Loans

Conforming loans meet guidelines that allow them to be sold to Fannie Mae or Freddie Mac. Their standards and loan limits are set by applicable agencies and can vary by location and year.

Private Mortgage Insurance (PMI)

PMI is commonly required on conventional loans when the down payment is less than 20%. It protects the lender if the borrower stops making payments.

Debt-to-Income Ratio (DTI)

Your DTI compares your monthly minimum debt payments with your monthly pre-tax household income. Lenders use it to evaluate whether the proposed mortgage payment fits your overall debt obligations.

Conventional Mortgages

Conventional mortgages are among the most common loan types. Qualified buyers may be able to purchase with a lower down payment, although credit, income, debt, and program requirements apply. PMI may be required when the down payment is below 20%.

FHA Loans

FHA loans are insured by the Federal Housing Administration and can offer flexible down-payment and credit guidelines for qualified borrowers. Requirements and lender overlays vary.

USDA Loans

USDA loans are designed for eligible buyers and properties in qualifying suburban and rural locations. Some borrowers may qualify for low- or no-down-payment financing, subject to income, property, and program requirements.

VA Loans

VA loans are available to eligible service members, veterans, and certain surviving spouses. Qualified borrowers may have access to favorable financing terms, including low- or no-down-payment options.

Jumbo Loans

Jumbo loans are used when the financing amount exceeds conforming loan limits. They are often used for higher-value properties and may have additional reserve, credit, or underwriting requirements.

Portfolio Loans

A portfolio loan is originated and retained by the lender instead of being sold on the secondary mortgage market. Because the lender keeps the loan, it may use its own underwriting standards.

Refinancing

Refinancing replaces an existing mortgage with a new loan, potentially with a different rate, term, or loan amount. The process shares many steps with buying a home, including income, asset, credit, and property review.

Preparing for a Mortgage Application

Down Payment, Closing Costs, and Assets

Lenders review the source of funds used for your down payment, closing costs, and reserves, along with your income and debts. Documentation is used to evaluate your qualifications as a borrower.

Acceptable Sources for Down Payment and Closing Costs

• Funds in checking or savings accounts
• Certificates of deposit, mutual funds, stocks, IRAs, and 401(k) accounts
• Proceeds from the sale of another property
• Gift funds from an eligible relative, when permitted by the loan program

Common Assets in a Mortgage Application

• Stocks, bonds, mutual funds, retirement accounts, and 401(k) accounts
• Life insurance
• Personal property estimates, such as vehicles, boats, antiques, or jewelry
• Other real estate or property with equity

Income and Employment

Lenders typically verify current gross income and stable employment. Documentation requirements can vary depending on whether income comes from hourly wages, salary, bonuses, commissions, self-employment, or other sources.

Debts

Your lender reviews current debts and credit history to understand your obligations and confirm that the new mortgage payment will fit your financial profile.

Closing Costs and Insurance

Closing a home purchase involves costs that may be paid by the buyer, seller, or both according to the purchase contract and loan program.

Common Mortgage-Related Closing Costs

• Loan origination fees: Administrative expenses for setting up and processing the loan.
• Points: Optional upfront fees that may lower the interest rate. One point equals 1% of the mortgage amount.
• Appraisal fee: The cost of having the property appraised.
• Credit report fee: The cost of reviewing the applicant’s credit history.
• Prepaid interest: Interest that may be due between the closing date and the beginning of the first mortgage payment period.
• Escrow deposit: Funds that may be collected to establish an escrow account for taxes, insurance, or other eligible expenses.
• Property taxes: Taxes may be prorated between buyer and seller at closing.
• Transfer taxes and recording fees: Charges associated with recording the transfer of ownership, where applicable.

Insurance Considerations

• Homeowners insurance
• Flood insurance, when optional or required by the lender based on the property location
• Private mortgage insurance, depending on the loan type and down payment
• Title insurance

Do’s and Don’ts While Obtaining a Mortgage

Loan approval is based on your financial profile during the mortgage process, not only at the time of application. Speak with your loan officer before making significant financial changes before closing.

Don’t

• Apply for new credit or authorize unnecessary credit inquiries.
• Make large or unexplained deposits without consulting your lender.
• Allow checks to bounce or accounts to carry negative balances.
• Make large purchases, cash advances, or significant credit-card charges.
• Quit or change jobs before closing.
• Pay off collections or charge-offs without lender guidance.
• Change bank accounts, consolidate debt, or close credit-card accounts without lender guidance.
• Transfer large balances between accounts without discussing documentation requirements.
• Max out existing credit cards, co-sign another loan, or make other changes that raise underwriting concerns.
• Give notice to a landlord, plan extended travel, or open a new mobile account without first consulting your loan officer.

Do

• Promptly provide documents requested by your mortgage professional, including your sales contract, tax returns, W-2s, pay stubs, and bank statements when applicable.
• Provide clear copies of every page of each requested document.
• Continue paying financial obligations on time.
• Provide contact information for the homeowners-insurance agent you select.
• Communicate openly with your loan officer and ask questions throughout the process.
• Provide a copy of the cleared earnest-money check and the corresponding bank statement when requested.
• Notify your lender of changes to the sales contract, including price or closing date.
• Ask whether the property is in a flood zone and whether flood insurance may be required.
• Keep your current insurance, residence, employment, credit use, and account activity stable unless your lender advises otherwise.
• Keep credit-card balances manageable and contact your lender before making employment, credit, or asset changes.

Important Notice

This page is for general educational purposes only and is not a commitment to lend, legal advice, tax advice, or financial advice. Mortgage products, rates, terms, underwriting guidelines, and assistance programs are provided by third parties and may change without notice. Always verify current information with the relevant lender, agency, or program provider.