To apply for a home loan in the United States, first assess your credit score and financial readiness. A minimum score of 620-640 is typically required for conventional loans, while FHA loans may accept lower scores with mortgage insurance. Gather documents such as pay stubs, tax returns, bank statements, and W-2 forms. Secure pre-approval from a lender to strengthen your offer. Submit a loan application with the chosen lender, including the property details and underwriting process. Finally, close the loan by signing final documents and paying closing costs, which average 2-5% of the loan amount.

The steps above are critical because creditworthiness directly impacts loan approval and interest rates. According to Fannie Mae, 75% of lenders require a credit score of at least 620 for conventional loans, with higher scores securing lower rates. For example, a borrower with a 740+ score may qualify for a 30-year fixed loan at 6.5%, while someone with a 620 score could face rates exceeding 7.5% (Federal Housing Finance Agency, 2023). Pre-approval reduces time spent house hunting, as 68% of sellers prefer offers from pre-approved buyers (National Association of Realtors, 2022). Closing costs, averaging $4,000-$8,000 per loan, are often rolled into the mortgage but increase monthly payments. Additionally, FHA loans, which require a 580+ score, offer lower down payments (3.5%) but impose annual mortgage insurance fees, raising long-term costs. These factors highlight the importance of thorough preparation and lender comparison to optimize borrowing terms.