Requirement #1: minimum credit score
Your credit score helps lenders gauge how reliably you’ve repaid debt in the past, and how risky it might be to lend to you now.
Here are a few common loan types and their minimum credit score requirements.
| Loan Type | Credit Score | Eligibility |
|---|---|---|
Conventional loans | 620 | For borrowers with solid credit scores and stable income |
FHA loans | 500 (with 10% down payment) 580 (with 3.5% down payment) | For first-time home buyers or people with lower credit and a smaller down payment |
VA loans | 620 | For service members, veterans and eligible surviving spouses looking for no down payment; requirements vary by lender |
Be sure to check your credit score early so you have time to correct errors and make improvements before a lender pulls it.
Requirement #2: manageable debt-to-income ratio
Your debt-to-income ratio (DTI) is a snapshot of how much of your monthly income is already committed to debt payments, and it’s an important part of figuring out how to qualify for a mortgage. A lower DTI is generally better. Many lenders prefer a DTI below 43%.
These are some of the common debts included in DTI:
- Credit cards
- Student loans
- Auto loans
- Personal loans
- Other housing payments (if applicable)
Lenders care about these sources of debt because they want to be confident your budget isn’t stretched so thin that one expense knocks things off track.
Requirement #3: stable and verifiable income
Lenders look for income that’s predictable and likely to continue, such as:
- W-2 wages
- Self-employment income
- Bonuses or commissions (when consistent)
- Retirement income (when documented)
Many lenders like to see an established history (often around two years), especially for employment and income patterns.
If you’re self-employed, working out how to qualify for a mortgage will likely mean extra documentation (like profit-and-loss statements and tax forms), because the lender needs a clearer picture of consistency. Job changes aren’t automatically disqualifying, but they can trigger extra questions, especially if you switch industries, move from a salary to variable income or start self-employment.
Requirement #4: money saved for a down payment and closing costs
Mortgage affordability isn’t just the monthly payment. Lenders also want to see that you can handle cash-to-close requirements.
A 20% down payment is often cited as a good number to aim for, but depending on your credit score and loan type, you may be able to put down less. FHA loans allow for 3.5% down for borrowers with certain credit scores, and VA loans often offer 0% down options. Some mortgage programs, like the Citi HomeRun® mortgage, allow you to put down as little as 3%. (Select markets only and income limitations may apply.)
As for the closing costs themselves, a common planning range is 2–6% of the purchase price (not including your down payment), though you may pay more or less depending on your loan and location.
Lenders like to see you’ll have some money left after closing, which reduces the likelihood of missed payments.
Requirement #5: proof of assets and a clean paper trail
Lenders don’t just check that you have funds, they take the additional step of verifying where the money comes from and whether it’s accessible.
Common asset documents include:
- Bank statements (checking and savings)
- Retirement account statements
- Brokerage or investment account statements
Also, be prepared to keep your bank activity boring in the weeks leading up to your application—large, unexplained deposits can slow things down.
Requirement #6: a property that meets lending standards
You’re not just qualifying as a borrower. The home itself has to qualify as collateral.
Most mortgage transactions involve an appraisal, which is an independent assessment of the property’s value. A lender may require an appraisal, and you’re typically responsible for the cost.
Some loan programs also have property-condition standards. For example, FHA financing can include minimum property requirements intended to ensure the home is safe and structurally sound.
If the appraisal comes in low, you may need to renegotiate the price, bring additional funds to closing or choose a different property.
Documents you’ll need to apply
Exact requirements vary, but these are common “starter” docs lenders request:
- Pay stubs
- W-2s or 1099s (often 2 years)
- Tax returns (often 2 years, especially if self-employed)
- Bank statements (often 2–3 months)
- Employment verification
- Government-issued ID and Social Security number (for the credit check)
Tips to help strengthen your mortgage application
A few moves that may help set your application apart are:
- Pay down high-interest debt: Paying off debts can improve your DTI and help boost your credit score.
- Work on credit before you apply: Make timely payments, lower your credit utilization and fix any errors you spot on your credit report.
- Increase your savings: Saving enough for a down payment and closing costs—and then some—can help to show lenders you’re ready to move forward.
- Avoid big purchases or credit account changes: Avoid opening or closing credit accounts, applying for other loans or making large purchases during the mortgage process.
- Keep income steady and documentable: Especially if you’re changing jobs or pay structure, be sure you have documentation of where your money comes from.