What is a mortgage?

A mortgage is a loan secured by real estate. You borrow money to buy a home and repay it over time, usually 15 or 30 years. If you stop paying, the lender can take the property through foreclosure.

Section 01

How mortgage payments work

Most payments include principal, interest, property tax and insurance. Early payments are mostly interest; later payments are mostly principal.

Section 02

Types of mortgages

  • Fixed-rate: the rate stays the same for the full term.
  • Adjustable-rate (ARM): the rate changes after an initial period.
  • FHA, VA, USDA: government-backed loans with specific requirements.
Section 03

FAQ

What credit score do I need?

Conventional loans often need 620 or higher. Better scores get better rates.

How much deposit do I need?

Key takeaway

20% avoids PMI in many cases, but FHA loans can require as little as 3.5%.

Next step · Free

Get a real rate quote, not an estimate

Compare what a licensed lender would actually offer you on rate, fees and monthly payment.

Get matched with a lender

Takes about 2 minutes · No obligation

First time home buyer steps from budget to closing

Before viewing homes, review income, debt, savings, credit, and the full monthly cost of ownership. A mortgage payment is only one component; property taxes, homeowners insurance, mortgage insurance, HOA dues, utilities, maintenance, and repairs may also apply. A debt to income ratio calculator provides a planning estimate, but a lender’s underwriting rules determine how debts and income are treated for a loan application.

Mortgage preapproval can help define a conditional financing range, but it is not final approval or a requirement to spend the full amount. Compare loan estimates from lenders, including the interest rate, annual percentage rate, points, lender fees, cash to close, and projected payment. An offer may involve earnest money, inspection terms, financing conditions, appraisal issues, and title review. Escrow and title insurance serve different purposes and should be reviewed separately.

Common questions

People also search for

Part of the Money & Debt (incl. Student Loans) cluster.

Get a real rate quote, not an estimate

Start