From renting to buying

The sequence (typical 12-24 months)

1. Credit floor. FICO 620+ qualifies for FHA. FICO 580-619 with a 10% down payment also qualifies. Higher scores = better rates.
2. Debt-to-income. Your total monthly debt payments (including the future mortgage) should be roughly under 43% of gross income. Pay down credit cards aggressively.
3. Down-payment cash. FHA requires 3.5%. Many state and city programs offer down-payment assistance up to $25,000+ — see step 5.
4. Pre-approval. Get a real pre-approval letter (not just a pre-qualification). Multiple lenders compete; pull all your inquiries within 14 days so they count as one on your credit.
5. Down-payment assistance programs. Search 'down payment assistance [your state]'. Most major cities and every state have programs. NeighborWorks, Habitat for Humanity, NACA, and HUD-approved counseling agencies all help. NACA's program offers no-down-payment, no-closing-cost, no-PMI mortgages specifically for low- to moderate-income borrowers.
6. Buyer's agent. Always use one — the seller pays the commission. Interview at least two. Ask specifically about their experience with first-time and FHA buyers.
7. Inspection, appraisal, close. ~45 days from accepted offer to keys.

Hidden costs to budget for

• Closing costs: 2-5% of purchase price.
• Moving expenses.
• 1-3 months of mortgage payments in reserve.
• Repairs and furnishings in year 1.