Reverse Mortgages: A Mortgage Solution for Homeowners 62+

For many homeowners, the greatest asset they own is the one they’re currently sitting in. After years of making payments and building equity, it’s finally time for your home to return the favor. Introducing Southern Trust Mortgage’s Reverse Mortgage Program, a loan option specifically designed to provide financial flexibility and peace of mind for homeowners aged 62 and older.

By Kiley Belanga
February 3, 2026

What is a Reverse Mortgage?

Unlike a traditional mortgage where you make payments every month, a Reverse Mortgage pays you. You retain ownership of your home, but you convert a portion of your equity into usable cash. The best part? No monthly mortgage payments are required as long as you live in the home as your primary residence, keep up with property taxes, and maintain homeowners insurance.

The beauty of this program lies in its flexibility. Homeowners who choose a Reverse Mortgage typically use their home equity to:

Supplement Retirement Income: Boost your monthly cash flow to cover daily expenses.

Eliminate Existing Debt: Pay off your current traditional mortgage to get rid of that monthly bill.

Cover Healthcare Costs: Manage unexpected medical bills or in-home care.

Home Renovations: Modify your home to make “aging in place” safer and more comfortable.

Is a Reverse Mortgage Right for You?

While a reverse mortgage is a powerful tool, it’s a big decision. It’s generally an ideal fit if:

You are 62+

You have significant equity in your home

You plan to stay in your home for the long term

Ready to take the next step toward financial freedom?

Your retirement should be about enjoying the life you’ve built, not worrying about the next bill. Our team of specialists is here to walk you through the process, answer your questions, and help you determine if this is the right move for your future.

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Key to Buying your First Home

By Wendy Lewis
January 30, 2026

Buying Your First Home? FHA Loans Can Help You Get There Sooner

Buying your first home is an exciting milestone. But it can also feel overwhelming. Navigating the world of mortgages and financing options is complex.

FHA loans offer a solution for many first-time homebuyers. These loans are backed by the Federal Housing Administration. They provide a path to homeownership with lower down payments and flexible guidelines.

FHA loans are designed to help those who might not qualify for conventional loans. They offer more lenient credit score requirements. This makes them accessible to a wider range of buyers.

Understanding FHA loan benefits can help you make informed decisions. It can bring you closer to owning your dream home. Let’s explore how FHA loans can help you get there sooner.

What Are FHA Loans and Who Are They For?

FHA loans are a type of mortgage specifically for homebuyers with limited funds or less-than-perfect credit. They are insured by the Federal Housing Administration. This insurance protects lenders if buyers default on the loan, making them less risky for lenders.

Designed to assist first-time homebuyers, FHA loans are flexible. They allow buyers with credit scores as low as 580 to qualify. This opens the door for many who might otherwise be denied a conventional loan.

FHA loans are ideal for:

First-time buyers
Buyers with limited savings
Buyers with lower credit scores

These loans offer a unique opportunity to enter the housing market with fewer barriers. By reducing financial strain, they simplify the path to homeownership.

Key FHA Loan Benefits for First-Time Homebuyers

FHA loans offer numerous advantages, especially for those buying their first home. One of the most significant benefits is the reduced down payment requirement. You might only need to put down as little as 3.5% of the home’s price.

Another major benefit is the flexible credit score requirements. FHA loans are accessible to those with scores as low as 580. This means that buyers with past credit issues have a better chance of qualifying.

FHA loans also allow the use of gift funds, making it easier to cover down payment and closing costs. Family members or friends can contribute toward these expenses.

Key advantages of FHA loans include:

Lower down payments
Flexible credit requirements
Acceptance of gift funds
Variety of property options

These benefits combined make homeownership more attainable. First-time buyers can secure their dream home without the usual stress.

FHA Loan Requirements: What You Need to Qualify

Qualifying for an FHA loan involves meeting specific criteria. The primary requirement is a steady income and employment history. Lenders want assurance of your ability to repay the loan.

Your credit score is another critical factor. While conventional loans often require higher scores, FHA loans accept scores starting from 580. This opens doors for buyers with less-than-perfect credit.

You also need to demonstrate a manageable debt-to-income ratio. Generally, lenders look for a ratio not exceeding 43%, though exceptions exist.

In summary, here’s what you need:

Steady employment and income
Credit score of at least 580
Acceptable debt-to-income ratio
Willingness to pay mortgage insurance premiums

Meeting these requirements helps you on the path to homeownership. With FHA loans, buying a home becomes a more realistic goal.

How FHA Loans Make Homeownership More Accessible

FHA loans make homeownership more attainable for many. They are specifically designed to assist first-time buyers. This involves accommodating those who might not qualify for standard loans.

A significant way FHA loans help is through lower down payment requirements. You can often secure a loan with as little as 3.5% down. This reduces the upfront cash needed, easing financial barriers.

Additionally, FHA loans allow for more flexible credit requirements. These loans can accept lower credit scores and higher debt-to-income ratios, broadening access to many aspiring homeowners.

Key access points include:

Lower down payments (as low as 3.5%)
Flexible credit score requirements
Acceptance of higher debt-to-income ratios

These factors combine to make home buying feasible for many potential buyers. With FHA loans, owning a home is more within reach.

The FHA Loan Process: Step-by-Step Guide

Getting an FHA loan involves several key steps. First, you need to get pre-approved. This involves working with a lender to assess your financial situation and loan eligibility.

Next, you start house hunting. Look for properties that meet FHA requirements. Remember, your choice affects both your lifestyle and investment.

Once you find the perfect home, make an offer. If accepted, it’s time for a formal loan application. This requires additional paperwork and verification.

Here’s a straightforward guide:

Get pre-approved: Consult one of our STM Loan Officers
Find a home: Work with an Agent to find your home
Make an offer: Your dedicated agent will help you write a promising offer
Finalize application: Submit necessary documents to your STM Loan Officer

Finally, upon approval, you attend the closing and secure your new home. This step confirms the loan and transfers ownership rights. Each stage in the process moves you closer to owning your first home.

FHA Loan Limits and Property Types

FHA loans come with specific borrowing limits. These limits vary by location and are influenced by local housing prices. It’s important to check the limits in your area to ensure you can borrow enough to purchase your desired home.

FHA loans are versatile and applicable to different property types. Options include single-family homes, multi-family homes, and select condos. This variety allows flexibility based on your needs and future goals.

Here’s a quick overview:

Single-family homes: Ideal for individual families.
Select condos: Must meet specific FHA standards.

Special FHA Loan Programs: 203(k) and More

FHA offers specialized loan programs beyond basic loans. One such program is the FHA 203(k) loan. This program allows buyers to finance both buying and renovating a home in one mortgage.

Other special programs include options for energy-efficient improvements. These can integrate energy-saving upgrades into loan amounts, making homes more sustainable.

Key programs to consider:

FHA 203(k): Combines purchase and renovation.
Energy-efficient programs: Supports eco-friendly upgrades.

Pros and Cons of FHA Loans

FHA loans offer distinct advantages for first-time buyers. They require lower down payments and have more lenient credit requirements. However, there are some drawbacks to consider.

For example, they involve mortgage insurance premiums, which can increase monthly costs. Here are key points to weigh:

Pros:
- Lower down payments
- Flexible credit criteria
Cons:
- Mandatory mortgage insurance
- Loan limits based on location

Tips for First-Time Homebuyers Using FHA Loans

Navigating the home buying journey can seem daunting. But with FHA loans, you have some leeway. Keep these tips in mind to make the process smoother.

Get pre-approved early
Consider all costs, not just the down payment
Use a trusted lender familiar with FHA loans

These steps can provide peace of mind on your path to homeownership.

Conclusion: Is an FHA Loan Right for You?

Deciding on the right mortgage option depends on your unique circumstances. FHA loans offer flexibility for those with limited savings or lower credit scores. If you seek affordable entry into the housing market, they could be an excellent choice.

Consider your financial goals and future plans. Understanding FHA loans in depth will guide you toward an informed decision.

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What to Expect and How to Prepare for Refinancing Your Home

If you are a homeowner, it’s likely you’ve heard the term “refinance” before. Whether you’re exploring the concept for the first time or considering your next move, understanding the process is key. We hope to address common questions about refinancing your mortgage and outline exactly what you can expect.

By Southern Trust Mortgage
January 29, 2026

What is Mortgage Refinancing?

When you apply to refinance your home loan, you are essentially attempting to pay off your existing mortgage and replace it with a new one. The new loan pays off the remaining balance of the former loan, and after closing, you begin making payments on the new loan’s principal, interest rate, and terms.

Why Do Homeowners Refinance?

Refinances are not required, but they can significantly improve your financial stability and future. The decision to refinance is typically driven by a desire to improve or secure a family’s financial future, primarily through these goals:

Lowering Your Interest Rate (Rate-and-Term Refinance): Securing a lower rate can reduce your monthly payment and the total interest paid over the life of the loan.
Shortening the Loan Term (Rate-and-Term Refinance): Switching from a 30-year to a 15-year term can save you substantial interest and help you build equity faster.
Using Home Equity (Cash-Out Refinance): A Cash-Out Refinance allows you to tap into the equity you’ve built to fund a large purchase, pay for home renovations, or finance college tuition.
Consolidating Debt (Cash-Out Refinance): Using a cash-out refinance to pay off higher-interest debt (like credit cards or personal loans) can lower your monthly outflows and simplify your finances.
Eliminating Private Mortgage Insurance (PMI): If your home’s new appraised value confirms you have at least 20% equity, refinancing your conventional loan can allow you to drop the costly Private Mortgage Insurance (PMI), immediately lowering your monthly bill.

When Does Refinancing Make Sense?

Refinancing involves costs, so it’s essential to determine if the long-term savings outweigh the upfront fees.

Calculating the Break-Even Point

A key step in determining if refinancing is worth it is calculating your break-even point. This is the amount of time if will take for your monthly savings to cover your closing costs.

Break-Even Point (Months) = Total Refinance Closing Costs / Monthly Savings from New Payment

If you’re planning to stay in the home longer than the calculated break-even period, refinancing is generally a financially sound decision.

Market Rate Conditions

Generally, a good time to consider refinancing is when current interest rates are at least 0.5% to 1.0% lower than your existing rate.

The Costs of Refinancing

Unlike when you purchase a home, you don’t need a down payment for a refinance. However, you will incur closing costs similar to those in the buying process. These fees typically range from 2% to 5% of the loan amount and cover expenses such as:

Lender Origination Fees
Appraisal Fees
Title Insurance and Searches
Attorney Fees

You typically have two options for handling these costs:

Pay Cash Upfront: Paying the closing costs out-of-pocket keeps your new loan principal lower.
Roll Costs into the Loan: You can finance the closing costs into the new mortgage. This means you pay less cash upfront, but your monthly payments and total interest paid will be slightly higher.

How the Refinance Process Compares to Buying a Home

The primary difference you will notice is that since you are already the homeowner, the refinance process is generally simpler. There are no real estate agents, no purchase contracts, and no down payment to worry about.

However, much of the loan process will feel familiar to when you purchased your home:

Application & Evaluation: Your credit score and income will be evaluated. You will complete a new loan application with a Loan Officer, and a team of underwriters will review your financial profile.
Property Appraisal: Most types of refinance loans require a property appraisal. This ensures the lender verifies that the home’s value is sufficient to secure the amount being loaned.

Preparing for a Smooth Refinance

To make your refinance process go as smoothly as possible, preparation is key.

Gather Financial Documents

Assemble your financial documents in advance. You will likely be asked to provide:

Tax Documents: Your W2s and/or tax returns from the past two years.
Pay Stubs: Your most recent pay stubs.
Bank Statements: Your most recent bank statements.

Protect Your Credit Score

Your credit score directly impacts the interest rate lenders can offer you. If you are uncertain of your credit score or think it needs improvement, contact your Loan Officer before you apply.

Review Your Home’s Value

Since the appraised value of your home can directly influence the rate a lender offers, it is in your best interest to ensure your property is in good shape. Also, verify that any major additions or renovations made since purchasing were properly permitted by your city.

Southern Trust Mortgage has been helping clients buy and refinance properties since 1998. Our loan officers are knowledgeable in all aspects of how a home loan refinance can benefit you. Ready to see if refinancing is right for you? Contact us today to discuss your financial goals.

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How to Save for a Down Payment: A Homebuyers Guide

Buying a home is a huge financial milestone, and saving for the down payment is often one of the largest hurdles buyers have to overcome. While everyone’s financial situation is different, the core tips for success are universal. Here are essential strategies to help you save for a down payment and confidently embark on your homebuying journey.

By Kiley Belanga
January 22, 2026

Determine Your Down Payment Goal

The minimum down payment amount is determined by the final price of the home and the specific loan program you’ll be using. You can meet with a Loan Officer to help you determine how much you can afford and how much of a down payment you will need.

Pro Tip: On average, first-time buyers are putting down between 6%-9% (NAR). A larger down payment can significantly lower your monthly mortgage payment and make your offer more competitive in a strong market.

Create a Monthly Budget (and stick to it)

Once you have your total savings goal, set a realistic timeframe (e.g., 24 months). Use this simple equation to calculate your savings target.

Monthly Savings Goal = Total Savings Goal / Number of Months

Breaking the large goal into a manageable monthly savings goal makes it easier to stick to and achieve. It’s important to remember that this needs to be realistic and in line with your income. Closely review all your monthly expenses to find opportunities to save more.

Open a High-Yield Savings Account

Your down payment money should be safe and accessible but still working for you. A High-Yield Savings Account (HYSA) is the perfect place for your funds. It offers safety (FDIC insured) and a competitive interest rate compared to a standard bank account, ensuring your funds grow faster.

Explore Down Payment Assistance Programs

Don’t assume that you must save every dollar towards the down payment yourself! Many state and local agencies offer Down Payment Assistance (DPA) programs and grants to make homeownership more attainable and affordable. The benefit of working with an experienced local lender is that they are familiar with the DPA programs available in your area and can determine what would work best for you.

Saving for a down payment required discipline, but by sticking to a solid plan and working with a team you can trust, homeownership is an achievable reality.

If you know you are ready to begin your homeownership journey, connect with a loan officer to discuss your situation, how much you should save, and your best next steps.

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What’s Your Rent Increase Exit Plan?

While rent continues to climb, more renters are looking for the exit.

By Kiley Belanga
January 20, 2026

If you have recently been faced with the sticker shock of a lease renewal, it might be time to trade that uncertainty for long-term equity.

Rent is on the Rise

Renters have seen some relief in prices since the peaks of 2022, but the overall trend remains steep. According to realtor.com, rent for 0-2 bedroom units remains 17.2% higher than in November 2019.

When you consider that the federal minimum wage has remained at $7.25 since 2009, the “affordability gap” is wider than ever. Even when two minimum-wage earners split the cost, the median rental unity is now unaffordable in 43 of the 50 largest U.S. metro areas. As rent continues to fluctuate, mortgage rates are taking center stage in 2026, offering a much-needed path to financial stability.

Mortgage Rates are Falling & Inventory is Growing

There is good news for those ready to stop renting. Compared to January 2025, mortgage rates have dropped a full percentage point. This is a huge win for buyers who have been waiting on the sidelines for the market to shift.

At the same time, housing inventory is finally returning to healthy levels. We are currently seeing an 8.9% jump in existing inventory, meaning more choices and less intense “bidding wars” for buyers. With the market shifting in your favor, now is the ideal time to determine if homeownership is your best next move.

Timing Your Exit Strategy

One of the biggest hurdles for renters is the fear of “double payments”, paying both a final month of rent and a first mortgage payment. To avoid this, start planning well before your lease ends:

Check Your Notice Period: Most leases require a 30- or 60-day notice. Use this window as your goal for closing on a home

Go Month-to-Month: If your timing doesn’t align perfectly, ask your landlord about switching to a month-to-month lease to gain flexibility.

Analyze the Costs: Even if there is a fee to break your lease early, the long-term benefit of building equity and locking in a lower mortgage rate often outweighs the one-time cost.

Making Home Happen: Grants & Assistance

We understand that saving for a down payment can feel unachievable when you are throwing thousands away on rent each month. That’s why we specialize in helping homebuyers find grants and down payment assistance programs to get them in the door.

These programs, offered by state and local agencies as well as non-profits, are designed to cover initial homebuying expenses. You can read more about available DPA programs here.

Stop the shock of rent hikes and start building your future! Contact one of our loan officers today to see which programs you qualify for and let us help guide you home.

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Lower Your Energy Bills with These Energy-Saving Tips

Saving energy doesn't just help the planet; it also saves you money each month. Many companies now create energy-saving products for the home, making these tips and products more accessible and easier to implement than ever before. You don’t need a massive renovation budget to make a significant impact.

By Kiley Belanga
January 15, 2026

Here’s our guide to the easiest and most cost-effective changes you can make today to reduce your energy consumption and lower your utility bills.

Energy-Efficient Lighting: Switch to LEDs

One of the oldest and best recommendations for easy energy-efficient swaps is to change your light bulbs. If you’re still using old incandescent or even compact fluorescent (CFL) bulbs, it’s time to fully embrace LED lighting.

LEDs use up to 90% less energy than traditional bulbs. They also last significantly longer, reducing replacement waste and hassle.

Pro Tip: Look for “ENERGY STAR” certified LEDs for guaranteed quality and efficiency.

Install a Smart Thermostat for Temperature Control

Smart home technology is a key energy-saving trend, and installing a smart thermostat is a small change that will make a big impact.

Smart thermostats learn your family’s routine and automatically adjust the temperature to maximize energy savings when you’re away or asleep. Many can be controlled through an app, letting you adjust the heat or AC before you even arrive home.

While installation requires a little wiring, it’s a popular DIY project for the average homeowner, or a quick job for an electrician. Once installed, the savings start immediately.

Prioritize Regular HVAC Maintenance

Your home’s HVAC system is likely the single biggest energy consumer. A well-maintained system runs efficiently, saving you money, while a neglected one works harder and hikes your bills.

How can I maintain my HVAC System?

Change the Filter: A dirty air filter restricts airflow, forcing the system to run longer. Change or clean your filter every 1 to 3 months, especially during peak heating and cooling seasons.

Schedule a Tune-Up: Extend the life of your furnace and air conditioning unit and reduce energy consumption by having a professional annually service your furnace and air conditioning unit.

Clear the Area: Keep outdoor air conditioning units and indoor vents free of debris, furniture, and foliage to ensure proper air flow.

Seal Leaks to Prevent Energy Loss

If your home is leaky, you are constantly paying to heat or cool the outdoors. Air sealing and insulation are essential for maintaining a home’s thermal boundary.

Where do I find air leaks in my home?

Windows and Doors: Use caulk and weatherstripping to seal gaps around frames.

Utility Penetrations: Check the areas where pipes, vents, and cables enter your home, like under sinks and in the attic. Use expanding foam or caulk to seal these openings.

Attic and Basement/Crawlspace: Ensure these areas have adequate insulation, as heat moves rapidly through poorly insulated spaces. If your attic insulation is below the floor joists, it’s likely time to add more.

Tackle “Phantom Power” or Standby Energy Loss

Did you know many electronics continue to draw power even when they are turned off? This is known as phantom power or a phantom load, and it can account for up to 10% of your household energy use.

Reducing or eliminating phantom power is a zero-cost way to significantly reduce your baseline energy consumption.

How can you reduce phantom power?

When not in use, unplug chargers, small kitchen appliances (like coffee makers and toasters), and TVs that are not in regular use.

Use power strips for entertainment centers and computer stations, and simply switch the strip off when the devices are not in use.

Optimize Your Water Heater for Maximum Savings

Your water heater is one of the largest energy users in your home. Typically, this is a result of water heaters being set to a higher temperature than needed, using unnecessary energy. Making a few simple adjustments can lead to impressive energy savings.

How can I improve my water heater?

Lower the temperature setting on your water heater to 120°F (49°C). This is a safe and efficient setting that prevents scalding and saves energy.

Make sure that the first six feet of hot and cold water pipes connected to the water heater are insulated with foam pipe insulation to further your energy savings.

Harness Natural Light and Solar Heat with Strategic Window Use

Your windows play an important role in creating energy efficient light and heat. Using them strategically is a simple, no-tech way to maximize your energy savings.

In the winter, open curtains and blinds on south-facing windows during the day to let in solar heat. Make sure they are closed tightly to prevent heat from escaping.

In the summer, close your curtains and blinds exposed to direct sunlight during the hottest parts of the day to avoid excess heat.

Explore Energy Efficiency Rebates and Programs in Your Area

The U.S. Department of energy offers several programs to help homeowners improve their energy efficiency and save on their energy bills each year. Here are a few of the programs available to homeowners:

Tax Credit Advantage

Homeowners can apply for a tax credit for qualifying upgrades made to their home. Visit energy.gov for more information and view the list of qualifying upgrades.

Weatherization Assistance Program

This program, through state and local agencies, helps low-income households reduce their energy costs through enegery efficiency improvements. Learn more about the program and see if you qualify here.

Energy Star Rebates

Many areas offer rebates for switching to ENERGY STAR certified products. These products meet strict energy-efficiency specifications while also helping you save energy and money while also protecting the environment. Find rebates near you here.

Ready to Start Saving?

Every dollar saved on your monthly energy bill is a dollar back in you pocket. Beyond the immediate savings, these energy-efficient upgrades add tangible value to your property, making your home more appealing to future buyers. If you’re considering the next big step in homeownership or are ready to find your own energy-efficient dream home, contact us today!

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The 2026 Housing Outlook: 5 Key Shifts Redefining the Market

If you’ve been waiting for the housing market to stabilize, 2026 is shaping up to be the year you’ve been looking for. While the era of 3% mortgage rates is behind us, a new, more balanced "normal" is finally emerging.

By Kiley Belanga
January 6, 2026

As we look ahead, these five market drivers will help define the homebuying experience in 2026.

1. Rebalancing of Home Inventory

After years of record-low supply, we are seeing a significant return to normal for inventory levels. According to realtor.com, we can expect an 8.9% jump in existing home inventory as homeowners move past the hesitation of giving up their previous low rates.

The Takeaway: You’ll have more options and less pressure to make frantic, sight-unseen offers. While inventory remains roughly 12% below pre-pandemic levels, the extreme bidding wars of the past are fading.

2. Mortgage Rates Find Their New Normal

Stability is the theme for 2026. Fannie Mae’s Economic and Strategic Research Group projects that 30-year fixed mortgage rates will settle into the low 6% range, potentially ending the year as low as 5.9%.

What this means for you: With rates stabilizing, buyers can finally plan their budgets with confidence. This predictability is a huge win for families who have been hesitant to commit to a monthly payment that might fluctuate.

3. The Rise of the “Instant” Mortgage

Technology has reached a tipping point. The Mortgage Bankers Association (MBA) reports that AI-driven underwriting and digital appraisal tools are making “same-day” mortgage approvals a reality for many borrowers.

The Advantage: At Southern Trust Mortgage, we are leveraging these digital tools to ensure your financing moves as fast as the market does. In 2026, speed is a major competitive advantage.

4. A Focus on Home Efficiency and Resilience

Modern buyers are looking past the granite countertops. Zillow’s 2026 Home Trends Report highlights a surge in demand for climate-resilient features, with listings mentioning flood protection (up 64%) and solar readiness seeing significantly higher engagement.

The Investment: Efficiency isn’t just about energy; it’s about household management. We are seeing a surge in demand for “grocery-optimized” homes that allow families to stock up during sales and minimize high-frequency trips to the store, effectively lowering their monthly food expenses over time.

5. Bridging the Equity Gap for First-Time Buyers

The gap between repeat buyers (who have existing equity) and first-time buyers remains a challenge. NAR’s Deputy Chief Economist, Jessica Lautz, recently noted that first-time buyers have dropped to an all-time low of 21% of the market, with the median buyer age rising to 40.

Your Strategy: If you are a first-time buyer, you don’t have to go it alone. 2026 is seeing an expansion in Down Payment Assistance (DPA) and specialized loan programs designed to help you compete with “cash-heavy” repeat buyers.

Make 2026 the Year for Buying Your Dream Home!

The market is moving away from the chaos of recent years and toward a more sustainable, predictable environment for both buyers and sellers.

Ready to see how these projections impact your specific move? The best way to navigate a changing market is with an expert by your side. Connect with a Loan Officer today to get a head start on your 2026 homeownership goals!

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Planning to Buy a Home in 2026: Here’s What You Should Be Doing Now

If purchasing a home is on your goal list for 2026, it’s crucial to start planning now to ensure you are fully prepared for everything the homebuying process requires. Before you start searching for houses, here are five key steps you should take first.

By Kiley Belanga
December 23, 2025

1. Start Researching Your Ideal Location

Being at the start of your home search, now is the perfect time to begin researching where you want to buy and what you are looking for in a home. Consider important factors like

Your commute to work or places you frequently visit.

The neighborhood’s resale value and surrounding amenities (parks, shops, etc.).

The quality of local school districts.

2. Get Your Credit in Check

Your credit plays a vital role in your home financing. Lenders evaluate your credit score to determine your creditworthiness and the interest rate you qualify for.

If you believe your credit score is less than ideal, we recommend speaking with your lender to determine your next steps. For example, at Southern Trust Mortgage, we have a team of credit specialists available to equip you with the tools and resources to build your credit into an ideal position to purchase your next home.

3. Pay Off Existing Debt and Lower Your DTI

While a variety of factors determine your mortgage eligibility, your debt-to-income (DTI) ratio is a major one. Lenders compare your total monthly debt payments to your gross monthly income to assess your ability to manage a new mortgage.

The preferred DTI varies by loan type and your specific situation; however, it is always best practice to keep it as low as possible. If your DTI is higher, consider taking steps to reduce and pay off your existing debts before applying for a mortgage.

3. Build Up Your Down Payment and Savings

You would be surprised how many people seriously interested in buying a home fail to consider the funds required for a down payment and closing costs. While buyers do not always need 20% down, most loan programs have minimum requirements. Plus, having more cash available when making an offer can make your bid more desirable, especially in a competitive market.

4. Get Pre-Approved (Your First Step with a Lender)

Meeting with a mortgage lender before you start your home search provides a realistic look at what you can truly afford and what your potential monthly mortgage payments would look like. Plus, meeting with a lender early allows you to build a relationship with a trusted home financing partner who will help advocate for you during the entire home buying process.

Whether this is your first time purchasing or you are an experienced buyer, getting pre-approved is key to a stress-free home purchase.

While these are just a few things that you can do to prepare for your home purchase, it is important to determine the best path for you and your personal financial situation. Get started and talk about the next steps with an experienced local lender today!

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Homebuyer Grants and Down Payment Assistance Programs: Making Homeownership More Accessible for Buyers of All Levels

The dream of homeownership often feels out of reach, especially for first-time buyers and those with limited savings. The biggest hurdle? The upfront, out-of-pocket funds needed for the down payment and closing costs.

By Kiley Belanga
December 18, 2025

Fortunately, there are a significant number of programs available that exist to address this challenge. Homebuyer grants and down payment assistance programs are powerful tools that make the path to owning a home more accessible for buyers of all levels.

What are Down Payment Assistance Programs and Homebuyer Grants?

Down payment assistance (DPA) programs are often offered by state and local housing agencies and non-profits and are designed to provide financial aid to cover the initial expenses of buying a home.

Who Qualifies for Down Payment Assistance?

While eligibility requirements vary by program, most down payment assistance and grant initiatives focus on helping those who need it most. This includes:

Income Limits: Most programs offer assistance to low-to-moderate income buyers. Your household income usually must be at or below a certain parentage of the Area Medium Income for your desired location.

First-Time Buyer Status: Many programs prioritize first-time buyers. This is not limited to someone who has never owned a home before. The definition of a first-time buyer extends to someone who hasn’t owned a home in the last three years. There are still some programs available to repeat buyers as well.

Credit Score: A minimum credit score is often required for these programs, typically in the 620-640 range, though this can vary based on each specific program’s requirements.

Property Type and Location: Programs may have limits on the maximum purchase price of the home and may be targeted to specific geographic areas.

To make homeownership more accessible, there are state-specific programs available in the markets that you are looking for:

Florida

Florida Housing Homebuyer Program: Offers 30-year fixed-rate first mortgage loans and access to several second mortgage programs for down payment and closing cost assistance (DPA).

Florida Hometown Heroes Program: Provides down payment and closing cost assistance (up to 5% of the loan amount with a max of $35,000) to eligible full-time working professionals in Florida, including military personnel, veterans, law enforcement, educators, healthcare workers, and more.

Florida Assist (FL Assist): A second mortgage program offering up to $10,000 in DPA as a 0%, non-amortizing, deferred loan. Repayment is deferred until the home is sold, refinanced, or the first mortgage is satisfied.

HFA Preferred and HFA Advantage PLUS Second Mortgage: Offers 3%, 4%, or 5% of the total loan amount as a forgivable second mortgage when used with a Florida Housing conventional first mortgage.

Maryland

Maryland Mortgage Program (MMP) 1st Time Advantage: Provides competitive, low-interest rate 30-year fixed-rate loans for first-time homebuyers and repeat buyers in targeted areas.

Maryland SmartBuy 3.0: A unique program that helps eligible homebuyers with student debt purchase a home. It can provide up to 15% of the home’s purchase price (maximum $20,000) to pay off student debt, plus down payment assistance. The student loan payoff is a zero-interest, deferred loan forgivable after five years.

MMP Down Payment Assistance Options (1st Time Advantage 6000/Flex 5000/3%/4%/5%): These options provide funds for down payment and closing costs, typically as a zero-interest, deferred second mortgage that is repayable upon sale, transfer, or refinance.

HomeAbility: Designed to assist homebuyers with disabilities, offering a first mortgage and a secondary zero-interest loan (up to $45,000) to cover down payment and closing costs.

North Carolina

NC 1st Home Advantage Down Payment: A DPA option available with the NC Home Advantage Mortgage™ for first-time buyers or military veterans, offering $15,000 as a 0%, deferred second mortgage. It is forgiven over years 11-15, with full forgiveness at the end of year 15.

NC Home Advantage Mortgage™: A separate DPA option offering assistance up to 3% of the loan amount for both first-time and move-up buyers.

South Carolina

SC Housing Homebuyer Program: Provides competitive, fixed-interest rate mortgages to eligible low-to-moderate income homebuyers, often used in conjunction with a Down Payment Assistance (DPA) option.

Palmetto Home Advantage: Available for first-time, move-up, and repeat buyers across all counties, offering forgivable down payment assistance options of 0%, 3%, or 4% of the loan amount.

County First Initiative: Offers a special fixed interest rate and forgivable Down Payment Assistance (DPA) to promote homeownership in previously underserved counties.

Tennessee

THDA Great Choice Home Loan: The Tennessee Housing Development Agency (THDA) offers this 30-year fixed-rate mortgage loan for first-time homebuyers, as well as repeat buyers in targeted areas or military members.

THDA Great Choice Plus: This DPA is a second mortgage that must be used with a Great Choice Home Loan. It has two options:

Deferred Option: Up to $6,000 at 0% interest, deferred for the 30-year term and then forgiven.

Amortizing Option: Up to 5% of the sales price up to $15,000 with a monthly payment over 30 years, and the interest rate is the same as the first mortgage.

THDA Homeownership for Heroes: Offers the benefits of the Great Choice program plus a reduced interest rate to veterans, active-duty military, and first responders.

District of Columbia (DC)

DC Open Doors: A program for qualified first-time and repeat homebuyers, offering home purchase loans, and down payment/closing cost assistance via a Down Payment Assistance Loan (DPAL). The DPAL is a deferred, 0% interest, non-amortizing second loan.

DC4ME: Provides first-trust mortgages at a reduced interest rate for qualified DC government employees. It also includes an option for DPA of up to 3% of the home price as a 0% deferred loan

Home Purchase Assistance Program (HPAP): Provides deferred interest-free loans for down payment and closing cost assistance to eligible, first-time, low-to-moderate-income homebuyers.

Virginia

Virginia Housing Down Payment Assistance (DPA) Grant: A true grant for eligible first-time homebuyers, covering 2% to 2.5% of the purchase price toward the down payment that never needs to be repaid. Buyers must contribute at least 1% down.

Virginia Housing Plus Second Mortgage: Offers DPA as a second mortgage for first-time and repeat homebuyers. It can also cover part of the closing costs for eligible borrowers.

Virginia Housing Closing Cost Assistance Grant: To help reduce the out-of-pocket expenses during the homebuying process, this grant helps cover the extra costs that come with buying a home.

Don’t let the savings barrier hold you back from your homeownership journey. These are just some of the many grant and down payment assistance options available. Contact a Southern Trust Loan Officer for assistance navigating different programs available and what would best help you with finding your next home.

Additional requirements and qualifications may apply for each state’s Down Payment Assistance and Homebuyer Grants. Consult with your loan officer to see if you qualify.

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FHA Loans: What You Need To Know

As one of the most popular loan options available for First-Time Homebuyers, the FHA Loan provides many great benefits when it comes to buying your dream home

By Kiley Belanga
December 16, 2025

What is an FHA Loan?

An FHA Loan is a type of mortgage loan that is insured by the Federal Housing Administrations (FHA). FHA Loans have more flexible qualifying guidelines than that of a conventional loan, allowing for many great benefits like:

Low Down Payment Requirements: You can secure your loan with as little as 3.5% down, compared to the typical 5% for many conventional loans.

Higher Debt-to-Income (DTI) Ratio: A more generous DTI Limit, sometimes up to 50% or more, helps borrowers with other monthly payments, like car or student loans, qualify for a mortgage.

Flexible Credit Requirements: Borrowers may qualify with less-than-perfect credit. However, a lower score may require a slightly higher down payment than the minimum.

Competitive Interest Rates: Buyers can enjoy stable monthly payments with competitive, fixed interest rates.

Gift Funds Allowed: Borrowers can utilize gift funds from eligible sources to help cover their down payment and closing costs.

These benefits significantly lower the barrier to entry into the housing market, making the dream of homeownership achievable for more people.

What are the Key Requirements for an FHA Loan?

While FHA Loans are flexible, they do have specific requirements. In addition to the property needing to be your primary residence and having proof of steady income and employment, you will need to consider:

Mortgage Insurance Premium (MIP): All FHA Loans require an MIP. This includes an upfront premium and an annual premium. Unlike Conventional Loans, the annual premium is typically required for the life of the loan, however, many borrowers choose to refinance later to remove it.

Down Payment and Credit Requirements: Your FICO score determines the minimum required down payment.

FICO score of at least 580: Qualifies for the minimum 3.5% down payment

FICO Score between 500 and 579: Requires a 10% down payment

Debt-to-Income Ratio: While exceptions exist, your total monthly debts should generally not exceed 43% of your gross monthly income

Worried you might not meet all the requirements? Talk with one of our experienced Loan Officers today, there are still options and strategies to get you to the closing table!

What are the property requirements for an FHA Appraisal?

When purchasing a home with an FHA Loan, the property must meet the FHA’s Minimum Property Standards (MPS) for safety, security, and structural soundness.

Your FHA-approved appraiser will look for common issues like:

Missing handrails or exposed wiring (safety hazards)

Peeling paint (especially in homes built before 1978 due to lead concerns)

Non-functional or deficient utilities like heating, water heater, or electrical

Signs of active water damage or structural issues

Important Note: If your appraiser flags a necessary repair, it usually must be completed before the loan can close.

Additional Info You Should Know

Do FHA Loans have Loan Limits?
Yes, FHA Loans have maximum loan limits that vary by county and are updated annually by the Department of Housing and Urban Development. Most areas have a baseline limit, but high-cost areas usually have a higher limit. Before you start looking for homes, it is important to confirm the current loan limit for your area.

What is the FHA Amendatory Clause?
Another benefit of using an FHA loan is that it prevents you from overpaying for the property is the Amendatory Clause. This clause is included in your sales contract and offers you protection if the home’s appraised value comes in lower than the agreed-upon sales price. Meaning if your FHA appraisal is low, you will be allowed to cancel the contract and receive your earnest money deposit (EMD) back or renegotiate the purchase price with the seller.

If you are looking to start your homebuying journey, an FHA Loan, especially when paired with local grant and down payment assistance programs, is a powerful mortgage option for those looking to break into the housing market. Get started with one of our loan officers today!

Please visit hud.gov for more information about FHA Loans and how they may benefit you.