The Real Estate Funding Guide

The Funding Myth — Why "I Can't Afford It" Is Usually Wrong

The number one reason people don't buy a home or invest in real estate isn't the market. It's not interest rates. It's the belief that they can't afford it. That belief is wrong far more often than it's right.

Myth: You need 20% down. False. FHA requires 3.5%. Many conventional loans allow 3%. Down payment assistance programs in Georgia and Florida can cover your entire down payment. Some USDA and VA loans require zero down.

Myth: You need perfect credit. False. FHA loans go down to 580 with 3.5% down. Some programs go to 500 with 10% down. DSCR loans for investors often care more about the property's income than your personal credit score.

Myth: You need a high income. False. VA and USDA loans don't have income caps that disqualify most buyers. DSCR loans don't use your personal income at all — they qualify based on the rental income the property generates.

Myth: You need to have all the money yourself. False. Down payment assistance programs, seller concessions, gift funds, and financing stacks exist specifically to bridge the gap between what you have and what you need.

Conventional Loans — What You Actually Need to Qualify

A conventional loan is a mortgage not insured by the federal government — originated by a bank or mortgage company and either held on their books or sold to Fannie Mae or Freddie Mac.

Key requirements:

• Credit score: Minimum 620, but 680+ unlocks better rates
• Down payment: As low as 3% through Freddie Mac's Home Possible or Fannie Mae's HomeReady programs
• DTI: Generally 43–45% max, though some lenders go higher with compensating factors
• Private mortgage insurance (PMI): Required if you put less than 20% down — but it falls off automatically once you hit 20% equity

When conventional makes sense: If your credit is above 680 and you have some down payment saved, conventional is often cheaper than FHA over the life of the loan because FHA requires mortgage insurance for the full loan term.

In Atlanta and Florida: Conventional loans work well for purchases up to the conforming loan limit ($766,550 in most counties for 2024). For higher-priced markets like Buckhead or 30A, you'll need a jumbo loan — typically 700+ credit and 20%+ down.