To check loan eligibility for a house purchase, start by reviewing your credit score, which must typically exceed 620 for conventional loans. Calculate your debt-to-income (DTI) ratio—front-end (house payment + taxes/insurance) and back-end (total debt) should be below 43% and 36%, respectively. Save for a down payment (20% for conventional, 3.5% for FHA loans) and closing costs. Pre-apply with multiple lenders to compare pre-approval letters, which outline loan amounts and terms. Lenders assess income stability, employment history, and asset liquidity during this process.

The steps above ensure lenders evaluate your financial readiness to avoid default. A 2023 Federal Housing Finance Agency report found that 60% of homebuyers obtain pre-approval before house hunting, reducing offer rejection risks. Credit score impacts interest rates significantly: a 700+ score secures rates 0.5–1% below those for scores 650–699 (Consumer Financial Protection Bureau, 2022). DTI ratios exceeding 43% disqualify 30% of loan applications (U.S. Census Bureau, 2023). Down payment requirements vary by loan type, with FHA loans enabling lower upfront costs but higher monthly premiums. Pre-approval letters strengthen offers, with 75% of sellers prioritizing pre-approved buyers (National Association of Realtors, 2023). Collectively, these factors minimize financial risk for lenders and buyers, ensuring sustainable homeownership.