Although credit standards have relaxed somewhat since the peak of the financial crisis that began a decade ago, there are minimum standards you must meet to qualify for different mortgages.

Good credit scores, an acceptable debt-to-income ratio and specific financial documents are some of the things you’ll need to apply and qualify for a home loan.

The requirements largely depend on the type of loan you’re applying for, so we’ve broken down lending requirements for several types of loans in this guide.

FHA loan requirements

FHA loan requirements

A mortgage through the Federal Housing Administration is one of the easiest home loans to get. Because the FHA provides insurance on the mortgage, FHA-approved lenders are often able to offer more favorable rates and terms.

Lenders are also more comfortable with potentially riskier borrowers, since the FHA is backing up to 90% of the mortgage. The lower down payment requirements with an FHA mortgage make it a good option for first-time homebuyers who may not have enough savings to make the typical 20% down payment on a home purchase.

These are the current minimum requirements for an FHA-approved mortgage:

Conventional loan requirements

A conventional 30-year or 15-year mortgage has slightly stricter qualifications than an FHA loan, but it does have some flexibilities and longer term benefits.

VA loan requirements

A mortgage through the Veterans Affairs department benefits active-duty military personnel, reservists, veterans and their families. The VA guarantees a portion of the loan, which enables lenders to offer more favorable terms to military personnel.

USDA-guaranteed loan requirements

The U.S. Department of Agriculture offers a mortgage program to provide low- to moderate-income families the chance to own their own homes in designated rural areas. Applicants can build, rehabilitate, improve or relocate a dwelling in an eligible rural area. These rural designations are determined based on population, using 2010 U.S. census data.

The USDA-guaranteed loan program backs 90% of the loan amount, which allows USDA-approved lenders to consider borrowers who may not qualify for conventional home loans. USDA mortgage loans require a minimum credit score of 640 for automatic approval — provided other requirements are also met. However, homebuyers with lower credit scores can still be considered for a manually underwritten loan.

To qualify for a USDA mortgage, you must also meet the special eligibility requirements in your state. First, use the USDA’s online tool to determine whether the property you’re considering is within a designated rural area. To use this tool, you’ll need to enter the street address, city and state where the house is located. This confirms whether the home you wish to buy is within one of the USDA’s designated rural areas.

Then use this USDA map to select your state and determine the current income eligibility requirements. Income limits vary by city, county and family size.

The homebuyer must also meet these basic requirements to qualify for a USDA mortgage:

Key mortgage documents

Before applying for a mortgage, you can make the process flow much smoother for yourself by organizing all the financial documents and other paperwork lenders typically require with the loan application.

These can include:

Getting preapproved for a mortgage

Before house shopping, it’s a good idea to find out how much you potentially qualify to borrow. That means you’re not wasting time looking at homes outside your price range. A mortgage preapproval means a lender has looked into your credit history, income stability and your current finances, and is tentatively prepared to loan money to you for a house.

To get a preapproval letter from a lender, you’ll need to provide:

A mortgage preapproval is usually good for up to 90 days. After that, creditors usually want to take another look at your finances to see if anything has changed.

Don’t worry about getting several inquiries to your credit if you get preapproved by several lenders. They will only count as one hard inquiry if you do them within a short time frame (15 to 45 days typically).

Buying a home is a major financial commitment and for many people, the culmination of a lifelong dream. LendingTree can help you compare mortgage products and offers. The road to homeownership may be long, but it doesn’t have to be a bumpy ride. By arming yourself with information in advance about the different loan programs available and the minimum requirements of each, as well as knowing what financial documents you’ll need, you’ve already taken important first steps to a smoother mortgage processing journey.

Buying a house can be an exciting and emotional process. Before starting your home search, you’ll want to understand the ins and outs of the home buying process. This will empower you to make decisions that are the best for your family — and your wallet.

What to consider:

Is now a good time to buy a house?
Based on mortgage and home-price trends, it’s a relatively good time for potential homebuyers. There are opportunities to lock in an affordable mortgage before interest rates begin to climb, as some experts think they soon will begin to do. The 30-year fixed-rate mortgage recently fell below 4 percent. That compares favorably with 4.88 percent a year ago.

Home prices, meanwhile, aren’t getting any cheaper. Annual home price growth is expected to increase by 5.4 percent by July 2020, according to real-estate data firm CoreLogic. Waiting too long to buy might mean getting priced out of more-desirable neighborhoods.

Who should buy a house?

Taking the leap to homeownership can provide a feeling of pride while boosting your long-term financial wellness, if you go in well-prepared and with your eyes open.

When thinking about buying a home, consider whether you want to put down roots or maintain flexibility with your living situation. How secure is your job, and can you comfortably budget for home repairs and maintenance on top of monthly housing payments? Finally, are you ready to stay in one place and do you have kids or family members to consider?

When should I buy a house?

Spring is the traditional start of the home-buying season, with many listings hitting the market, but it’s also a competitive time of year. Buyers can sometimes snag great in the off-season, such as the dead of winter or on holidays when fewer people are looking.

More important than the season, though, is your own financial readiness. This means having your finances organized and your credit in order so that you’ll be able to secure a reasonable mortgage in a smooth fashion.

In addition to a down payment, potential home buyers should have enough money set aside to cover the closing costs, which can range from 2 percent to 4 percent of the purchase price.

When budgeting for the monthly payments, factor in not only the principal amount and interest, but also property taxes, homeowners insurance, homeowners association fees and (if putting down less than 20 percent) private mortgage insurance. Don’t forget to set aside money for ongoing maintenance and those unexpected repairs that are bound to pop up.

Here’s a step-by-step guide on buying a house:

Key takeaways:

Primary Financial Requirements for Purchasing a Home

Getting a home inspection prior to closing can reveal hidden problems with the home.

Owning a home gives you freedom, privacy and tax deductions for your property taxes and mortgage interest. According to Habitat for Humanity, the children of homeowners do better in school, have fewer discipline problems and go on to earn more money than children of non-homeowners. But before you can buy a house, you have to get your household budget in order.

Gather Your Information

“Every lender has its own checklist of personal and financial information that it requires before approving your mortgage loan,” says real estate agent Anita Cordell. At a minimum you’ll likely need your Social Security number; addresses going back at least two years; current and past employment information; verification of your current income, such as check stubs; banking information, including types of accounts and the assets in those accounts; federal income tax returns for the past couple of years; and information about your living expenses and other debts. “Gathering your basic financials into a single folder will make the process go smoother,” she adds.

Demonstrate Sufficient Income

“You must be able to show your lender that you have sufficient income to make your mortgage payments as they come due,” says Cordell. Each lender has its own standards, but most use a formula to determine a qualifying ratio that you must achieve before they will make the loan. Qualifying ratios typically range from 26 to 29 percent of your gross monthly income, depending on whether you’re going for a conventional or government-backed loan, such as FHA or VA. For example, you’ll need a gross monthly income of $4,000 to qualify for a mortgage loan with a payment of between $1,040 and $1,160, including principal, interest, property taxes and homeowners insurance.

Control Your Debt

Paying down your existing debt before you apply for a mortgage loan can help the process. The more debt you carry, the less home you can buy. Lenders combine your housing expenses with your long-term debt, meaning any debts you carry for over 11 months, to come up with another qualifying ratio. Depending on whether you’re applying for a conventional or government-backed loan, these ratios range from around 33 to 41 percent, so if you’re carrying significant long-term debt, it can reduce the amount of mortgage debt you can qualify for. For example, with an FHA loan, if you make $4,000 per month, your combined mortgage payment and long-term monthly debt payments can’t exceed $1,640.

Keep Your Credit Score High — and Accurate

Before a lender will give you a mortgage loan, it wants to know that you have the ability to make your monthly mortgage payments, and that you have the willingness to do so. Your willingness to repay your debts is typically reflected by how you have handled your debt obligations in the past. Your lender will check your credit report to see how you’ve done. You have the right to check your own credit report from the three major credit reporting companies, free of charge, once per year. “Your credit report is not always accurate, so it’s a good idea to check before your lender does, just to make sure there are no surprises,” Cordell advises. “That way, if you find errors you can correct them before they cause problems with the mortgage lending process.”

Save a Down Payment

Mortgage lenders like to know that you have a commitment to the home you want to buy. Your down payment is your skin in the game. Conventional lenders typically ask for a 20 percent down payment, but if you apply for a government-backed loan, your down payment might be as low as 3.5 percent, or even less. If you want to buy a $200,000 home with a conventional loan you’ll need a down payment of around $40,000. If you go through an FHA lender you would only have to put down around $7,000. The trade-off of making a lower down payment is that you’ll carry a larger loan balance, which results in a higher monthly payment. You’ll also be required to carry mortgage insurance, which will also add to the amount of your monthly payment.