In honor of National Homeownership Month

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Buying a home has never been easy, but today it feels nearly impossible for many families. High prices, rising interest rates, and tight credit standards make homeownership feel more like a dream than a goal. And yet, people haven’t stopped dreaming. And those of us working alongside them—housing counselors, financial coaches, and trusted advisors—continue to help them move forward.

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At Prosperity Now, we believe homeownership is still worth fighting for. But the way people get into homes today looks different than it did in the past. We need tools that reflect the way people actually live now. If you are a first-time buyer or someone who supports them, this guide outlines what you need to know now, and where to find help that makes a difference.

Step 1: Know Where You Stand

Check your credit score:

Your credit score affects the types of loans you can get and what your interest rate will be. A higher score can help you qualify for better terms, but a lower score does not mean the door is closed. Programs like FHA loans are available to many buyers with scores starting at 580. You can check your credit for free at AnnualCreditReport.com.

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Understand your debt-to-income (DTI) ratio:

This ratio shows how much of your income goes toward paying debts like student loans or credit cards. A lower number usually makes it easier to qualify for a mortgage. If your ratio is higher than lenders prefer, a housing counselor or financial coach can help you build a strategy to improve it.

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Plan for your down payment:

You do not need 20 percent down to buy a home. Some loans require as little as 3 percent. If your down payment is under that 20 percent mark, you may also need to pay monthly mortgage insurance, which increases your overall cost.

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The good news is that many federal, state, and local programs offer support to first-time homebuyers. These may include down payment assistance, lower interest rates, or tax benefits. Eligibility usually depends on your income and location. Understanding what support is available in your area can make all the difference.

Step 2: Understand Your Options

Many first-time buyers choose from well-known mortgage options:

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• FHA loans for buyers with lower credit or smaller savings

• VA loans for veterans and military families

• USDA loans for rural buyers

• Conventional loans for buyers with higher credit scores and more savings

These traditional products are widely used, often come with safeguards, and may offer fixed interest rates and predictable terms.

At the same time, new models of homeownership are beginning to emerge. In some communities, buyers are purchasing homes with friends or family through co-ownership. Others are joining housing cooperatives that lower the cost of entry by sharing land and responsibilities. Shared appreciation products are also gaining attention, offering ways to reduce upfront costs in exchange for a share of future home value growth. These models reflect the realities of how people live and work today. But like any financial product, they come with tradeoffs, and they are not always the right fit for every household.

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If you are exploring one of these newer options, be sure to talk to a trusted expert, such as a HUD-approved housing counselor or nonprofit advisor. They can help you compare choices, understand long-term risks, and decide what aligns with your goals and your budget. Not all products are created equal, and getting guidance early can protect you from making decisions that could cost you down the line.

Step 3: Get Support Early

Buying a home is a big decision, and it’s easier when you aren’t doing it alone. Whether you are preparing to buy or helping someone else do so, the support of a knowledgeable advisor can be a game-changer. Housing counselors, nonprofit homeownership advisors, and financial coaches are ready to help with credit review, budgeting, loan comparisons, and navigating local programs that can reduce costs or expand access. You can find a HUD-approved housing counseling agency here.  

Share Your Story and Shape the Future

At Prosperity Now, we are focused on expanding access to homeownership by supporting solutions that reflect how people live and work today. We know those solutions work best when they are informed by real experiences.

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If you are working toward homeownership, or guiding others along that path, we want to hear from you. Visit storiesofprosperity.org and share your experience. Your story helps shape smarter policies, stronger tools, and a future where more people have the chance to own a home.

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Homeownership is still possible. With the right support and a path built for today’s realities, the American Dream does not have to stay out of reach.