Buying a home can be fun and exciting. It can also be very challenging if you are not prepared. There are definite steps to preparing your finances for this process, and while it seems like a lot of work, and it can be, it will pay off when you are ready to purchase your new home.

Why Do I Need to Pre-Qualify for a Loan?

There are many reasons for you to pre-qualify before you begin searching for a home. The first is that before your REALTOR works with you, they will want to know you’re qualified to buy a home.

Did you know that a pre-qualification form is part of our residential purchase contract? Yep, it needs to be sent with your offer to purchase a home. This also helps the Seller know that you’re serious about the process of buying their home. They likely will not even look at or consider an offer without a letter of qualification from a reputable lender.

Another reason is that the amount you qualify for can often dictate where and what type of home you will be looking for.

If you’re planning to buy a home soon, a pre-qualification should be the first thing on your list. Check out this list of steps to help you pre-qualify for a home loan so you can be properly prepared: 

Review Your Credit Score

Your credit score plays a significant role in securing the right mortgage for you. The higher your credit score, the better. Good to excellent credit scores, those around 670 and above get higher chances of mortgage approval and lower interest rates. 

Review your credit report and make sure that you know your credit score. To get a copy of your credit report, go to places like freecreditreport.com. Everyone who goes there can get one free credit report per year.

Gather Your Financial Documents

Lenders need to know that you’re capable of paying your monthly mortgage. You need to prepare your financial documents to make sure you can give them accurate information about your income, assets and ability to pay a mortgage. 

Lenders will want to see things like your most recent 2 to 3 months of paystubs, bank statements, tax returns from the last two years, credit report, and tax transcripts from the IRS.

From that information, your debt-to-income ratio helps your mortgage professional provide you with a total amount you can afford to buy.

Prepare for the down payment

Some mortgages will require a 20% down payment, while some will require a lot less, like FHA or VA loans. If you’re not qualified for the latter, you may need to prepare to pay a larger amount. Remember, 20% is NOT needed for a conventional mortgage. In fact, it is very common for people to use 5 or 10% as their down payment amount.

Many types of loan programs are available. A good mortgage professional will help guide you to the best product for your financial situation.

You can also decide to put down a more significant down payment if you wish to do so. A higher down payment will reduce the amount you need to borrow, reducing your monthly mortgage payment. Sometimes, a higher down payment can also reduce the amount of your interest rate.

Find The Right Lender for You

We are happy to give you a list of lenders from which to choose. We work with several lenders and mortgage brokers who work with different companies to help you find the best loan program for your situation. A benefit of a mortgage broker could be having many lenders to choose from and finding the best loan programs for your unique situation.

Give yourself a variety of options and talk to reputable lenders. Most mortgage brokers have access to similar programs, so it’s best to choose the broker who has a really good communication process. 

Securing your pre-qualification letter

Once you’ve gone through all of the above, your lender will issue you a pre-qualification letter. We will send a copy of that form with your offer on the home of your choice.

A Word of CAUTION: Do not buy anything on credit once you’ve entered into the mortgage loan process. No new cars, appliances, or furniture. Any changes in your credit report could adversely affect your credit score and disqualify you from obtaining a loan.

Are you excited about your new home? 

Preparing to buy a home can be stressful if you don’t know what to do or where to start. If you think you’re ready, give us a call, and we can help you through the entire process! Our team can help you with the purchase of any home for sale, and we can help you find the one that’s best for you!

Recently, we looked at the website for the U.S. Department of Housing and Urban Development. You know, HUD, the guys that make the rules for FHA loans. What we found is that, in the entire city of Tempe, only 6 condominium complexes are listed as being “HUD Approved Condominium Projects.” Basically, what that means is, if you are trying to purchase a condo in Tempe, your FHA loan choices are limited to a very small percentage of buildings that have homes for sale. Even if mom and dad are helping with a “parent student home loan” and have golden credit with tons of cash in the bank, HUD says “no can do.” Yes, really.

The list below shows the complexes we saw as being FHA approved as of 02/12/2016. This list does change from time to time so please contact us if you would like an updated copy at any time. In fact, it looks like the Springdale Condos could expire as soon as next week.

Alameda Park, 102 W Concorda 85282 – 136 units, Expires 9/11/2017

Broadmor Place, 17 E Fiesta Dr 85282 – 51 units (31: 1 story units 20: 2 story units 6 buildings.) Expires 6/17/2017

Hudson Trace, 2333 E Southern 85282 – 138 units, Expires /04/2018

Mistwood Condominiums, 633 W Southern 85282, Expires 10/20/2017

Springdale Condominiums, 1222 W Baseline 85283 – 114 units Expires 2/14/2016

Villagio condominiums 2401 E Rio Salado 85281 ( multiple addresses, all “should” be approved? ) 742 units Expires 3/17/17

It looks like the 525 Town Lake condos applied in 2013 but were rejected due to missing documents or incomplete package submission

University Ranch Condominiums 905 S Lola Lane 85281 – 112 units rejected due to missing documents or incomplete package submission ( applied 2/14 )

Many single family homes will qualify for FHA financing, but there are things that can eliminate them from the equation. For an updated and accurate list of homes for sale in any area, contact The Nick Bastian Team at 602-803-6425. We’ll be happy to help in any way.

The homes below are condominiums in FHA approved complexes.

FHA Condos in Tempe

15 Listings

$475,000 2401 E RIO SALADO Parkway 1095
Tempe, AZ 85288 Listing office: JR Jones Realty

$249,999 2333 E SOUTHERN Avenue 2016
Tempe, AZ 85282 Listing office: Real Broker

$450,000 2401 E RIO SALADO Parkway 1003
Tempe, AZ 85288 Listing office: HomeSmart

$354,900 280 S EVERGREEN Road 1249
Tempe, AZ 85288 Listing office: Realty ONE Group

$314,000 2333 E SOUTHERN Avenue 1073
Tempe, AZ 85282 Listing office: Realty ONE Group

$359,900 280 S EVERGREEN Road 1317
Tempe, AZ 85288 Listing office: Good Oak Real Estate

$324,900 16 W LOMA VISTA Drive 104
Tempe, AZ 85282 Listing office: Venture REI, LLC

$327,000 633 W SOUTHERN Avenue 1152
Tempe, AZ 85282 Listing office: RE/MAX Fine Properties

$475,000 280 S EVERGREEN Road 1368
Tempe, AZ 85288 Listing office: Grigg's Group Powered by The Altman Brothers

previous next

MLS IDX Listing Disclosure © 2026

Copyright 2026 Arizona Regional Multiple Listing Service, Inc. All rights reserved. Information Not Guaranteed and Must Be Confirmed by End User. Site contains live data.

In 2006 and 2007, the Home in 5 program helped over 2200 families with a 5% grant to be used towards the expenses of down payment and closing costs when purchasing a home. This was a highly successful program that was ultimately responsible for over $400 million in down payment assisted home loans. That’s big.

After the market crash in 2007, interest rates were extremely volatile and mortgage bonds were becoming far less appetizing for investors. The original Home in 5 down payment assistance program was a bond driven program, so it was ultimately gone with the wind… with so many other home buyer options.

Now called the Home in 5 Advantage, here are the highlights:

• 5% down payment assistance. Assistance is calculated as 5% of the initial principal balance of mortgage loan.
• 30 year Fixed Rate Home Loan. Interest Rate (set by IDA) currently 3.875% **The interest rate may change periodically to stay competitive with the market**
• This is a grant, so no repayment is required.
• Eligible loan types: FHA, VA, or USDA-Rural
• Minimum 640 credit score
• Maximum of 45% debt to income ratio
• There is no First Time Homebuyer Requirement
• Maximum qualifying income of $90,000
• No maximum home purchase price (subject to income and debt ratios)
• Important for Military (Qualified Veterans, Active Duty Military, Active Reservists, Active National Guard)
• Down Payment Assistance is increased to 6%
• No income restrictions

————————————————————————

About the author:

Shane Hollenback is a mortgage lender at Bay Equity Home Loans in the east valley. Shane can be reached at 602-690-7581.

It’s true, there were 100,959 home sales last year in our market. Of those sales, nearly half ( over 47,000 ) were CASH sales. Yep, greenbacks. No financing, at all. That’s a lot of cash.

Of the homes sold in our market last year, 87% of them were under $200,000 purchases. Of that 87%, we see that a total of 63% of 2011 home sales in our market were below $100,000! Heck, remember 2005?  You were hard pressed to find anything for less than $100,000. We have seen a LOT of investor activity in this real estate market.

Who’s buying homes?

People who have been lulled to sleep or who have not been paying attention to the real estate market for a while seem to be surprised when they have difficulty “stealing” property in today’s market. Inventory is low, rates are good, and the thought of missing the bottom of the market is pulling at people’s wallets.

My question is this. If we now have record low mortgage rates, how long will this trend continue? We are hearing reports of parents buying homes for their kids, investors pulling out of the stock market and buying multiple properties, renters looking to SAVE money on housing expenses, etc. On the other hand, we hear of overall lower home ownership rates as people struggle in this economy.

Short sales and foreclosures made for more than 70% of the sales during the last year. People talk about the “shadow inventory” of bank owned homes, but many people I have talked to in the business don’t see it coming. Many properties are being sold at the “courthouse steps” before they ever go back to the bank. The market is ever changing. Stick around, we’ll have a lot more to talk about in the very near future…

If you have any questions or comments, “Just Call Nick!” I can be reached at 602-803-6425. That’s 803-NICK.

The Arizona real estate market, like many others, continues to change at a rapid pace. While the trend is currently looked at by many as “distressing,” there are those who look at this market as an opportunity to purchase real estate in an environment of low interest rates and at price levels not seen for quite some time.

One of my long time “partners” in the real estate business is Fidelity National Title. For those of you that have worked with me for a long time, you might be familiar with them. Recently, I got some very interesting statistics from my friend, Jennifer Weller, an account rep for Fidelity. We discussed some of the current issues banks are dealing with when handling distressed properties.

1. 40% of the subprime loans written in ’06 & ’07 had no income verification.

2. Chase has a new program that if you lose your job-they will reduce your payment to $500 for months to help homeowners not lose their home.

3. It costs lenders on avg 75-125k per bank owned property.

4. fannie mae loan-primary residence…foreclosure=ineligible for 5 yrs for a FMae mortgage, short sale=2 yrs

5. investor ineligible for a Fannie Mae loan for 7 yrs in Foreclosure, short sale=2 yrs

6. foreclosure lowers credit 250-300 pts for avg of 3 yrs…and stays on credit for 10+ yrs
These 6 items are from Jen’s “Twitter” feed while attending a seminar. I hope to go over the details with her in the near future and will gladly update you with any questions you might have. We will be reviewing the notes and updating / adding to the information in the near future.

As in every market, it is best to understand and make good educated decisions before buying or selling. There is always a seller that wants to sell and a buyer that wants to buy.

Let’s discuss your situation before you decide to make a move. As always, I’ll give you my honest opinion of your current situation. If it makes sense for you to make a move, I am happy to assist. If it doesn’t, I will be glad to tell you so.

If you just want to “get a feel” for prices of homes in an area, (including foreclosure lists / distressed properties) you may visit my FREE map-based home search page to begin the process.

As always, remember to “Just Call Nick” with any questions or comments! I’m here to help. 602-803-6425.

I found this language on the Ameridream web site. (Update: 2019 – the Ameridream website no longer exists) “Those programs, operated by charitable organizations in accordance with current law and HUD guidelines, have helped more than one million FHA qualified, low and moderate income families and individuals buy their own homes since 2000.” The emphasis on “HUD guidelines” and “FHA qualified” is mine.

Who exactly runs HUD? Who determines FHA guidelines? Are these considered sub prime lenders? hhmmm.

click here to read Gary’s post and all of the comments..

On Wednesday of last week, I received an email from a friend at Wells Fargo that talked about some of the coming changes dealing with people that want to buy another home while keeping their current home.

The problem, in case you are not aware, is where people that purchased a home at the top of the market and are now “upside down.” Then, they go out and buy another home, at a lower price and “give back the keys” to the lender for the original home, allowing it to be foreclosed instead of the owner fulfilling their financial obligation.

Part of the new guidelines are as follows.

The new Fannie Mae BUY & BAIL policy states that a buyer planning to retain and rent out their current residence must: 1) prove 30% equity in the property, 2) provide a copy of the new lease agreement, and 3) provide a copy of the renter’s security account. If these criteria are not met, rental income may not be used to qualify and a reserve requirement is also added. Buyers who plan on keeping their current residence as a second home must qualify on both payments and show 6 months reserves for both house payments.

If this is “clear as mud” to you, please feel free to “Just Call Nick” for a better explanation.

Here’s some information I found from Fannie Mae website:

Buy and Bail Characteristics

The homeowner is current on the mortgage, but the value of the home has fallen below the amount owed, so he or she
applies for a purchase money mortgage on another home. After the new property has been secured, the buy and bail
borrower will allow the first home to go into foreclosure.
 The borrower defaults on the original mortgage shortly after purchasing a second property
 The borrower will be a first-time landlord (renting out the original property)
 The borrower has minimal or no equity in the original property
 Inability to validate lease terms with the purported tenant
 Purported tenant has a pre-existing relationship with the homeowner

As always, I will be happy to discuss current market conditions and some of the “hot buttons” in the real estate industry right now.

Of course, I would never suggest that anyone attempt to get out of their financial obligations. However, it is an interesting topic of discussion…