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How to Get a Mortgage

If you’re not paying cash for one of the biggest purchases of your life—a house—then step into Mortgage Class 101!

But be warned: Getting a mortgage is work. It’s up to you to choose a home and a mortgage that puts you on the path to debt-free homeownership. Otherwise, you could find yourself in a serious financial mess, having to say goodbye to all your financial hopes and dreams—or goodbye to your house in foreclosure.

The fact is, there’s no shortage of mortgage loan options out there, and most of them take you down a road you don’t want to go down. But if you’re as careful about which mortgage to choose as you are which home to buy, you can enjoy the excitement and dignity of homeownership.

How to Get a Mortgage in 9 Steps

  1. Review Your Budget
  2. Assess Your Credit
  3. Gather Your Documents
  4. Get Pre-Approved—or Better, Get Certified
  5. Choose the Right Mortgage
  6. Decide on a Lender
  7. Submit Your Application
  8. Begin the Underwriting Process
  9. Close on the House

1. Review Your Budget

Before you step foot in a lender’s office, look at your finances and make sure you’re ready to buy a home. You should be out of debt with an emergency fund of 3–6 months of expenses, and you should have at least a 10% down payment saved. (20% is even better and will help you avoid having private mortgage insurance added to your payments.)

For many people, this is the hardest hurdle to jump. But if you have car loans, student loans or credit card debt, the last thing you want to do is take on owning and paying for a home. It’s okay to rent for a while, focus on paying off your debt, and think about your mortgage options later.

If you know you’re ready to buy a home, awesome! You’re in a good place to consider a mortgage, so ask yourself these two questions before moving on.

Get the right mortgage from a trusted lender.

Whether you’re buying or refinancing, you can trust Churchill Mortgage to help you choose the best mortgage with a locked-in rate.

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How much home can you afford?

Don’t let the bank decide how much mortgage you can afford. You decide. You can do that right now with our mortgage calculator. Our recommendation is to take out a mortgage with a monthly payment that’s no more than 25% of your monthly take-home pay. That will give you plenty of room in your budget to pay other bills, save for your kids’ college, and invest for your retirement.

Don’t let the bank decide how much mortgage you can afford. You decide.

Can you afford the extra costs of homeownership?

On top of monthly mortgage payments, you’ll have plenty of other expenses: lawn care, home repairs and maintenance, homeowner’s insurance, property taxes, homeowners association fees, and whatever furniture and decor you buy for your new home. Look at your budget and make sure you can take on all these costs without dipping into your emergency fund.

2. Assess Your Credit

Lenders don’t want to give a huge loan to someone who has a reputation for not repaying debt. That’s about as dumb as giving a pilot’s license to someone with multiple DUIs! And since lenders haven’t come up with another way of doing this, they’ll check your credit score.

What credit score should you have?

If you plan on using your credit score to get a mortgage, it should be between 620 and 850. But if you follow our way of thinking, you won’t even need to worry about this.

Can you buy a house without a credit score?

Yes! If you don’t have a credit score, that doesn’t disqualify you from getting a mortgage. No credit score is not the same thing as a low credit score. Low credit means you don’t repay debt well. No credit means you’ve been out of debt, and you haven’t relied on credit cards or other kinds of loans to make any purchases—a great place to be.

Dave Ramsey recommends one mortgage company. This one!

When you don’t have a credit score, you’ll need a lender who does manual underwriting. Manual underwriting means a lender looks closely at your history in paying rent, income, and monthly bills like your utilities or cell phone. This will help them determine if they can safely lend you money.

3. Gather Your Documents

Once you start the mortgage process, you’ll discover how much lenders love documentation. They want everything—proof of income, assets and employment.

Even if you don’t need these documents right now, go ahead and get them ready so you can speed up the mortgage process later.

Even if you don’t need these documents right now, go ahead and get them ready so you can speed up the mortgage process later.

What documents do you need to get a mortgage?


  • Driver’s license or U.S. passport

  • Social Security card or number

  • A copy of the front and back of your permanent resident card (for non-U.S. citizens)


  • Your paystub from the last 30 days

  • W-2 forms from the last two years

  • Tax returns from the last two years (You’ll probably have to sign a Form 4506-T, which allows your lender to request a copy of your tax returns from the IRS.)

  • Business federal income taxes from the last two years (if applicable)

  • Any kind of reward letter: social security, disability or retirement (All of these should show that you’ll keep getting income from these sources for the next three years.)

  • Receipt of child support for the last 12 months (if applicable)


  • Bank statement

  • Last quarterly statement of all your investing accounts, including 401(k)s, IRAs, mutual funds, etc.

  • Last two months of bank statements for any checking or savings accounts (Internet copies are fine as long as they contain the bank name, account number, your name, and 60 days’ history.)

4. Get Pre-Approved—or Better, Get Certified

Once you’ve gathered all your documents, you’re ready for the next big step: Visit a lender and get a mortgage pre-approval.

What’s a mortgage pre-approval?

A mortgage pre-approval happens when a lender looks at your finances—income, assets and credit history—and decides how much mortgage you can afford. When you get pre-approved, sellers know you mean business because you’ve already started working with a lender—and a lender has agreed to work with you.

Does a mortgage pre-approval guarantee a mortgage?

No. A mortgage pre-approval means you are probably going to get the loan, but you still have to submit your application to a mortgage underwriter to get the final nod.

Is there anything better than a pre-approval?

These days, most buyers are already pre-approved for a mortgage. If you want a true competitive edge, becoming a Churchill Certified Homebuyer is a great option.

The difference between being a certified homebuyer and being pre-approved is simple. When you’re certified, a mortgage underwriter has already reviewed your application, a step that usually happens much later in the process. You’ll have a clear advantage over pre-approved buyers who have to wait until the middle of the homebuying process for an underwriter to review their application. It’s like being a few steps ahead in a footrace. You’re that much closer to the finish line.

5. Choose the Right Mortgage

Lenders will offer you more mortgage options than you can shake a stick at. They’ll swear up and down that you can buy a bigger home, make the monthly payments, and pay the mortgage over 30, 40, even 50 years!

Hold up!

Before you lock yourself into any kind of "creative financing" option, familiarize yourself with how a mortgage works, especially the loan term and interest rate.

What loan term should you choose?

When it comes to loan terms, keep the difference between shorter and longer-term mortgages in mind.

Shorter-term mortgages (like a 15-year mortgage) have higher monthly payments but lower interest rates. Longer-term mortgages (like a 30 or 40-year mortgage) have lower monthly payments but higher interest rates—and a higher cost in the long run.

So, imagine you’re buying a $225,000 house. On a 30-year mortgage with a 4.5% interest rate and a 10% down payment, you’d pay $1,387 a month. At the end of 30 years, you’d pay $499,320 for that house—$274,320 more than the selling price.

Now, let’s imagine you bought that $225,000 on a 15-year mortgage with a 4% interest rate and a 10% down payment. Every month, you’d pay $1,859. At the end of 15 years, you’d pay $334,620—$164,700 less than a 30-year mortgage.

That’s a lot of money to spend on interest, and it’s why we recommend a 15-year loan term. Sure, your mortgage payments will be higher, but you’ll knock that home loan out in less time and save thousands in interest.

Should you get a fixed or a variable interest rate?

Variable interest rates—like an adjustable rate mortgage (ARM)—are terrible, terrible, terrible! Yeah, sure, banks advertise lower initial interest rates. But just wait until the rate starts to adjust. It tends to go only one way: Up! Save yourself some money and go with a fixed interest rate.

Which mortgage is the best deal?

The right mortgage isn’t one that allows you to buy a bigger house, a house you really can’t afford. That’s a recipe for disaster! The right mortgage is one that puts you on the path to actual debt-free homeownership.

The best mortgage deal is a 15-year conventional mortgage. It’s the best because it’s the one that will save you the most money. With a 15-year conventional mortgage you’ll save way more in the long run.

6. Decide on a Lender

Once you’ve researched mortgage options on your own, you’re ready to find a lender.

What should you look for in a mortgage lender?

Stepping into a lender’s office can be intimidating. After all, you’re about to make an enormous purchase, and your lender is going to help you finance it.

That’s why you don’t want just anyone loaning you money. You want someone who mentors you through the process, explains your mortgage options, and gives clear answers to your questions. You wouldn’t decide to go fishing and ask a dairy farmer for help—unless of course they also happened to know a ton about fishing. You’d find an experienced fisherman to teach you how to bait a hook, cast a line, and reel in your catch.

That’s why you don’t want just anyone loaning you money. You want someone who mentors you through the process, explains your mortgage options, and gives clear answers to your questions.

We recommend you work with Churchill Mortgage. They’re experienced and they’ll walk with you throughout the entire mortgage process, from the day you apply for your mortgage to the day you make the last payment.

What questions should you ask a lender?

To help you decide which lender is right for you, ask a potential lender these key questions:

  • How much time do you need for home appraisals, underwriting and closing?

  • How do you prefer to communicate with your clients? Over the phone, email, or text messaging?

  • What fees will I pay at closing?

  • Do you offer loan rate locks?

  • Do you guarantee on-time closings?

7. Submit Your Application

Make sure you’re working with an experienced real estate agent to help you make the right choice. Once you’ve found a house you want to buy and the seller has accepted your offer, it’s time to get that application approved.

If you’re using the same lender who gave you the mortgage pre-approval, you won’t have to resubmit your documents. Otherwise, take all the documents (from #3) to the new lender, and your lender will begin the application process.

What happens after you submit your application?

After you submit your application, your lender will want to be absolutely sure the house is worth what you’re paying. Usually, lenders check the value of a house with a home appraisal and inspection.

  1. Home Appraisal: When an appraiser looks at the house, they determine its market value. A lender will almost never loan you more than the appraiser claims the home is worth. So, if a home’s market value is less than the seller’s price, you’ll have to negotiate the price down.

  2. Home Inspection: Does your home have damage that you can’t see? Is the roof pretty on the outside but held together by rotting wood? If the home you want to buy has any major problems, a home inspector will find out. Whether your lender requires a home inspection or not, you should get one anyway—for peace of mind.

8. Begin the Underwriting Process

Guess what? If you became a Certified Homebuyer in #4, you get to skip this step.

Your lender will eventually pass the loan application to a mortgage underwriter who will look at your documents and decide if you’re financially ready for a mortgage. Yes, this step can be nerve-racking. But hang in there! If you’ve followed our advice for choosing a home you can truly afford, you have nothing to worry about. (And if you haven’t followed our advice, well, you better hope you get denied to keep you out of a financial mess.)

How long does mortgage underwriting take?

Underwriting can be as short as three days or as long as three weeks, depending on the accuracy of your documents. If you made a mistake, missed a signature, or have questionable assets, a mortgage underwriter will suspend the process and contact you immediately. Make yourself available and avoid doing any of the following:

  • Opening a new line of credit (which we don’t recommend anyway)

  • Making an extremely large purchase

  • Changing jobs

  • Failing to pay rent or monthly bills

9. Close on the House

If the underwriter approves your application, you can finally breathe a sigh relief. You’ll still need to pay closing costs—around 2% to 5% of your home’s purchase price—and sign the closing disclosure, but at this point, there should be no surprises. You’re getting a mortgage!

What should you do before closing?

If you haven’t already, make sure you do these things before you close:

  • Get homeowner’s insurance. Talk with an insurance agent at least a month before you plan to close on your house.

  • Get title insurance. This insurance will protect you from any problems in your home’s title.

  • Get a cashier’s check. This check is proof that you have the exact amount of down payment you said you’d pay. You will need to bring this on closing day when you sign your closing disclosure.

What is a closing disclosure and when do you have to sign it?

The closing disclosure is the last document you will have to sign. (Cue the music: "And now, the end is near . . .") Basically, this document gives you the final details on your mortgage: the loan amount, monthly payments and fee totals. You must sign the closing disclosure within three days of closing.

Who needs to attend closing day?

Yes! It’s finally here: closing day. Closing usually happens at an attorney’s office, and the roster must include:

  • You and any co-borrowers

  • Your lender

  • Your real estate agent

  • Your attorney (if you’re working with one)

  • The seller

  • The seller’s real estate agent

  • The seller’s attorney (if they’re working with one)

Once everything is signed by both buyer and seller, you’ll get the keys to your new house. When that happens, you can do a happy, celebration dance. You did it. You got a mortgage!

Get a Mortgage the Right Way

If you’re looking for someone who will walk with you in the mortgage process every step of the way, check out Churchill Mortgage and talk to a home loan specialist.

The folks over at Churchill really know what they’re doing. They’ve been helping families get mortgages the right way for over two decades.

So don’t wait! Contact a Churchill Loan Specialist today.

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Ramsey Solutions

About the author


Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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