Most of the buying process gets figured out after you’ve found a house. Financing is the one piece worth sorting out before you start looking, since it determines your actual budget, not the number a listing search filter lets you dream about.

Short version: Get pre-approved, not just pre-qualified, before house hunting seriously. Conventional loans can go as low as 3-5% down for qualified buyers, FHA as low as 3.5%, VA and USDA can go to 0% down for eligible buyers. As of this writing, 30-year fixed rates sit in the high-6% range, worth confirming current numbers since they move weekly. Florida’s own Hometown Heroes program offers up to $35,000 in down payment and closing cost assistance for eligible workers, real money that a lot of qualified buyers never apply for.

Pre-qualification vs. pre-approval, and why the difference matters

Pre-qualification is a quick, informal estimate based on numbers you self-report, no verification, no real weight behind it. Pre-approval means a lender has actually pulled your credit and verified income and assets, and issues a conditional commitment for a specific loan amount. Sellers and agents treat these very differently, an offer backed by pre-approval gets taken seriously, an offer backed by pre-qualification often doesn’t. Get pre-approved before you’re seriously touring homes, not after you’ve found one you want to offer on.

The main loan types

Conventional loans aren’t government-backed and typically require the strongest credit and down payment, though first-time buyer programs can bring that down to 3%. FHA loans are government-insured, more forgiving on credit score, and allow down payments as low as 3.5%, but carry mortgage insurance that’s harder to shake than conventional PMI. VA loans, for eligible veterans and active-duty service members, can go to 0% down with no monthly mortgage insurance at all. USDA loans also allow 0% down but only for homes in USDA-designated rural-eligible areas, which in Central Florida can include parts of Lake, Osceola, and Polk counties outside the immediate Orlando metro core, worth checking the USDA eligibility map for a specific address before assuming it doesn’t qualify.

The 20% down payment myth

A lot of buyers assume they need 20% down to buy at all. Most don’t. Conventional loans commonly go to 3-5% down for qualified first-time buyers, FHA to 3.5%. What 20% actually buys you is avoiding mortgage insurance and getting the best available rate tier, not eligibility to buy in the first place. Putting down less means a higher monthly payment and mortgage insurance on top of it, a real tradeoff, but not a wall.

Credit score and debt-to-income ratio

Your credit score affects both whether you qualify and what rate you’re offered, lenders publish rate tiers, and moving up even one tier can meaningfully change your monthly payment. Debt-to-income ratio (DTI), your monthly debt payments divided by gross monthly income, is the other major factor, most loan programs want to see DTI under roughly 43%, though specific limits vary by loan type and lender. Both are worth checking and addressing months before you apply, not the week you find a house.

Where rates actually stand right now

As of early September 2026, the average 30-year fixed rate sits around 6.7 to 6.8%, with 15-year fixed running closer to 6%. This number moves week to week based on inflation data and Fed policy, treat any rate mentioned here as a snapshot, not a promise, and get a live quote when you’re actually ready to lock. If you’re within 30 to 60 days of a likely closing, most loan officers will talk you through whether locking now or floating makes sense given where things stand at that moment.

Mortgage insurance: PMI vs. MIP

Conventional loans with less than 20% down require private mortgage insurance (PMI), which can typically be removed once you reach 20% equity, either through payments or appreciation. FHA loans charge mortgage insurance premium (MIP) instead, which on most FHA loans originated with less than 10% down stays for the life of the loan, the only way off it is refinancing into a different loan type entirely. Worth factoring into a real cost comparison between FHA and conventional, not just comparing the down payment requirement alone.

Rate locks and buydowns

A rate lock guarantees your interest rate for a set window, typically 30 to 60 days, protecting you from rate moves between application and closing. Some lenders offer a one-time float-down option if rates drop after you lock. A temporary buydown, commonly a “2-1 buydown,” lowers your effective rate for the first year or two (often paid for by the seller as a concession) before stepping up to the actual note rate, worth understanding as a negotiating tool if a seller is motivated, not something to assume is standard.

Florida’s own down payment assistance: Hometown Heroes

The Florida Hometown Heroes program, run by the Florida Housing Finance Corporation, offers up to $35,000 in down payment and closing cost assistance to first-time buyers working in a wide range of frontline and essential occupations, teachers, healthcare workers, first responders, law enforcement, and more, structured as a 0% interest second mortgage that’s deferred until you sell, refinance, or pay off the first mortgage. It’s not forgivable, but it carries no monthly payment. Funding is allocated by legislative cycle and has historically run out before the fiscal year ends, worth asking a participating lender about current availability early rather than assuming it’ll still be funded when you’re ready to close. There’s no cost to apply, and if anyone asks for an upfront fee to access it, that’s not legitimate.

What your monthly payment actually includes

The number a mortgage calculator spits out for principal and interest isn’t your real payment. Add property taxes (lower if homesteaded), homeowners insurance (increasingly significant, see what’s actually happening with Florida insurance in 2026), possibly flood insurance, mortgage insurance if applicable, and HOA dues if the community has one. In Florida specifically, insurance has become a large enough line item that it genuinely affects how much house you can qualify for, lenders factor your estimated insurance premium into their DTI calculation, so a high-premium property can reduce your approved loan amount even if the purchase price itself would otherwise fit your budget.

Between application and closing

After you’re under contract, the loan moves into underwriting: verification of everything you reported, an appraisal to confirm the home’s value supports the loan amount, and title work. This is also when home inspection findings can affect financing, certain FHA and VA loans have property condition requirements a conventional loan wouldn’t. Expect this process to take roughly 30 to 45 days from a clean application to closing, longer if anything surfaces that needs resolving.

Sources:
https://www.freddiemac.com/pmms
https://www.floridahometownheroeshousingprograms.com/
https://themortgagereports.com/mortgage-rates-now/mortgage-rates-today-september-2-2026