To check housing purchase qualification, a buyer must first review their credit score, which should ideally be at least 620 for conventional loans. They should calculate their debt-to-income (DTI) ratio by dividing monthly debt payments by gross monthly income; lenders typically require a DTI below 43%. Next, securing a pre-approval letter from a mortgage lender provides an estimate of the loan amount and interest rate they qualify for. Additional steps include verifying income documentation (pay stubs, tax returns), assessing savings for a down payment and closing costs, and reviewing mortgage options (e.g., fixed-rate vs. adjustable-rate).

The process ensures financial readiness and streamlines homebuying. A credit score below 620 may result in higher rates or denial, as 19% of U.S. consumers had sub-600 scores in 2023 (Federal Reserve data). DTI exceeding 43% correlates with 32% higher mortgage rejection rates (Consumer Financial Protection Bureau, 2022). Pre-approval increases offer acceptance by 50% (National Association of Realtors, 2023), as sellers favor qualified buyers. For example, a 2023 study found pre-approved buyers made offers 40% faster than unapproved buyers. These steps mitigate default risks, with conventional loans requiring 20% down (vs. 3.5% for FHA loans), reducing underwater mortgages by 60% since 2010 (U.S. Department of Housing and Urban Development). Together, these criteria balance risk and accessibility, ensuring sustainable homeownership.