Homebuyer Guide


Everything you need to know to buy a home with confidence

Buying a home is a big step—but it doesn’t have to be overwhelming. At Capital City Home Loans, we’re here to make your homebuying journey smooth, personalized and well-informed. Whether you're buying your first home or your fifth, our comprehensive Homebuyer Guide walks you through each stage of the journey, from budgeting and pre-qualification to closing day.

Designed to demystify the process, this resource empowers you with clear steps, expert tips and helpful tools. Whether you're wondering how much house you can afford or what to expect at closing, you'll find clear answers and expert advice here.

 

Common Questions About Mortgages

One of the first steps in the homebuying journey is understanding your budget. Our experts are here to help you evaluate your income, debts, and financial goals so you can shop for homes with confidence.
Several factors impact affordability:
  • Your income - both gross and net
  • Monthly debts - credit cards, car loans, student loans
  • Down payment amount
  • Estimated property taxes and insurance
  • Your credit score
Generally speaking, you can purchase a home with a value of two or three times your annual household income. However, the amount that you can borrow will also depend upon your employment history, credit history, current savings and debts, and the amount of down payment you are willing to make.  
 
You may also be able to take advantage of special loan programs for first time buyers to purchase a home with a higher value. Give us a call, and we can help you determine exactly how much you can afford. 
 
Keep in mind a few common costs in addition to the mortgage payment amount that will affect your monthly budget.
With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage. We highlight some key features on our Adjustable-Rate and Conventional Fixed-Rate pages to give you a general idea how each might fit into your plans and goals. When you're ready, we're here to help you weigh all the options and select the right loan product.
An index is an economic indicator that lenders use to set the interest rate for an ARM. Generally, the interest rate that you pay is a combination of the index rate and a pre-specified margin. CCHL’s commonly used indices for ARM products are 1-year CMT for government loans and SOFR for all other loans.
There is no simple formula to determine the type of mortgage that is best for you. This choice depends on a number of factors, including your current financial picture and how long you intend to keep your house. We highlight some key features and differences on our Mortgage Comparison Chart to provide a general idea how each might fit into your homeownership journey. When you're ready, our mortgage experts can help you evaluate your options and choose the best fit for your financial picture and plans. 
 
Common mortgage types:
  • Fixed-rate mortgage - Stable monthly payments
  • Adjustable-rate mortgage (ARM) - Lower initial rate with future adjustments
  • FHA loan - Low down payment, flexible credit
  • VA loan - Exclusive benefits for military buyers
  • USDA loan - No down payment for qualifying rural areas
  • Jumbo loan - For high-value homes above conventional limits
For most homeowners, the monthly mortgage payments include three separate parts:
  1. Principal - Repayment on the amount borrowed
  2. Interest -Payment to the lender for the amount borrowed
  3. Taxes & Insurance - Monthly payments are normally made into a special escrow account for items like hazard insurance and property taxes. This feature is sometimes optional, in which case the fees will be paid by you directly to the County Tax Assessor and property insurance company.
The amount of cash that is necessary depends on a number of items. Generally speaking, though, you will need to supply:
  1. Earnest Money - The deposit that is supplied when you make an offer on the house
  2. Down Payment - A percentage of the cost of the home that is due at settlement
  3. Closing Costs - Costs associated with processing paperwork to purchase or refinance a house
One of the biggest questions for homebuyers is how much they need to put down on a house. The good news? You may not need as much as you think.
Typical down payment requirements:
  • Conventional loans: 3%–20%
  • FHA loans: as low as 3.5%
  • VA and USDA loans: 0% down (if eligible)
What to know:
  • A larger down payment can lower your monthly payment and avoid PMI (private mortgage insurance)
  • Many state and local programs offer down payment assistance for first-time buyers
Let our team help you find options that fit your savings plan.

































Additional tools & topics for homebuyers






Glossary Of Mortgage Terms