🏡 Home Loan 101: What Buyers Need to Know About Mortgage Types, Pre-Approval & Down Payments

Think you need 20% down to buy your first home? Think again.

At The Ramsey Team, we love helping first-time buyers discover what’s actually possible—and it’s usually a lot more doable than you think.

If you’ve been dreaming about homeownership but are worried about how much cash you need, how to qualify, or where to even start—this blog is for you. We’re breaking down the basics of mortgages, pre-approval, and down payments to help you move forward with clarity and confidence.
Plus, we’ll share how some of our clients have bought their first home with less money out of pocket than most people spend on a used car—and how you can take the first simple step today.

🏦 What Is a Mortgage, Anyway?

A mortgage is simply a loan used to buy a home. You repay it monthly over time (usually over 15 to 30 years), and the house acts as collateral for the loan.

But here’s the part most people get wrong:

🔑 You do not need a 20% down payment to buy a home.

In fact, many first-time buyers qualify for loans with far less upfront investment. There are even programs designed to reduce out-of-pocket costs significantly—especially for first-time and qualified buyers.

✅ Pre-Approval: Your First Step Toward Homeownership

Getting pre-approved is one of the most empowering moves you can make—even if you’re early in the process or just gathering information.

Pre-approval means a trusted lender reviews your finances and gives you an accurate picture of how much you can afford and what your out-of-pocket expenses might be.

Here’s why it matters:

• 🎯 You’ll know exactly what price range to shop in

• 💪 You’ll make stronger, more credible offers

• 🧭 You’ll get a personalized roadmap—not just a generic quote

Pro tip: You don’t need perfect credit or a big savings account to start the conversation. One quick, complimentary consultation with one of our trusted mortgage pros can reveal your custom path forward—whether you're buying sooner, later, or just exploring.

💸 How Much Do You Really Need for a Down Payment?

Spoiler: It’s probably a lot less than you think.

Most first-time buyers are surprised to learn that many loan programs only require:

• 3% down for Conventional loans

• 3.5% down for FHA loans

• 0% down for eligible VA buyers

There are also down payment assistance programs available in the Greater Phoenix area that could help reduce the upfront cost even more—sometimes even covering a portion of your closing costs.

Not sure where your funds will come from? Acceptable sources include:

• Your personal savings

• Gifted funds from family 💌

• Employer bonuses or grants

• Approved assistance programs

🧾 Let’s Talk About Closing Costs

In addition to your down payment, you’ll also have closing costs, which typically run between 2–4% of the home’s purchase price. These cover things like:

• Loan processing fees

• Title services

• Property taxes

• Insurance

But here’s where our team makes a big difference:

🤝 Your Ramsey Team agent will negotiate on your behalf to ensure your financial comfort is protected. We often ask the seller to help cover your closing costs—so you can save even more.

📅 The Best Time to Start? As Soon As You're Curious ✨

Whether you’re just exploring the idea of buying, actively preparing, or hoping to make a move in the near or distant future—it’s never the wrong time to start the conversation.

🧡 Starting early gives you more options, more clarity, and more confidence—no pressure, just progress at your own pace.

We’ll connect you with one of our trusted mortgage professionals for a completely complimentary consultation where you’ll receive:

• 🧾 A personalized affordability plan

• 💳 Credit-building strategies (if needed)

• 💡 A clear breakdown of potential out-of-pocket costs

• 📅 A realistic roadmap to homeownership based on your goals

Even if you're years away from buying, having the right people in your corner now can help you move forward with purpose—on your timeline.

🌟 Real Clients. Real Stories.

We’ve helped multiple first-time buyers purchase their homes with $1,500 or less out of pocket—and yes, some even got that money refunded at closing. When you combine honest education, trusted guidance, and the right lender-agent partnership, homeownership becomes possible much sooner than most people expect.

👋 Let's See What's Possible—Together

Buying your first home shouldn’t feel intimidating. It should feel exciting, empowering, and achievable—and with the right support, it absolutely can be.

If you’re even just curious about buying a home someday, reach out today. There’s no pressure, no obligation—just a friendly, informative conversation to help you take the next right step.

👉 www.RamseyTeamHomes.com/Connect
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