First-Time Homebuyer Guide for Arkansas: Where Do I Even Start?
Updated: Oct 25
Buying your first house can feel like one of those things everyone else somehow knows how to do. How much money do I need? What credit score do I need? Should I talk to a Realtor first? Do I need 20% down? What if my credit isn’t perfect? How do I know what payment I can actually afford? You don’t need to figure all of that out before talking to a lender.
In fact, that’s kind of the point. If you’re thinking about buying a home in Arkansas, here’s what the process actually looks like.
Step 1: Start Before You Think You’re Ready
One of the biggest mistakes I see first-time buyers make is waiting to talk to a lender because they think they need to “get everything together” first. Please don’t spend six months randomly paying things off because somebody on the internet told you to. Sometimes paying off an account helps. Sometimes it doesn’t. Sometimes the money you’re about to use to pay off a debt would be much more useful toward your home purchase.
Your first conversation with a lender doesn’t have to mean you’re buying a house next week. It’s simply figuring out where you are now and what the smartest next step is. And if you’re not ready yet? That’s okay. I’d much rather help you build a plan than have you guess.
Step 2: Figure Out What You Can Comfortably Afford
There’s a difference between what you qualify for and what you actually want to spend every month. Those numbers do not have to be the same. Before we start looking at houses, I want to know what payment feels comfortable for your household.
Your total housing payment may include: • Principal and interest • Property taxes • Homeowners insurance • Mortgage insurance, depending on the loan • HOA dues, if applicable This is also why online mortgage calculators can be misleading. A house that looks affordable based only on principal and interest can look very different once we calculate the actual estimated monthly payment. I can work backward from your comfortable payment and help you understand what price range may make sense.
Step 3: Review Your Credit
You do not need perfect credit to buy a house. You also shouldn’t assume that because an app shows you one credit score, that’s necessarily the exact score a mortgage lender will use. When we review your situation, we’re looking at more than the number itself. We’re also looking at your debts, monthly payments, credit history and whether there are opportunities to improve your overall loan scenario.
If your credit needs some work, that doesn’t automatically mean “no.” It may just mean “not yet.” That’s exactly why I created my Mortgage Ready approach. Instead of sending someone away with a vague “work on your credit and come back later,” I want you to understand what needs to happen and why.
Step 4: Look at Your Loan Options
There isn’t one “first-time homebuyer loan.” Depending on your situation and where you’re buying, you may have several options.
Conventional Loans
Conventional financing can work well for many first-time buyers, and you do not necessarily need 20% down.
FHA Loans
FHA financing can be another option for buyers, including some buyers who may have less-than-perfect credit or need a lower down payment.
USDA Loans
USDA financing can offer 100% financing for eligible properties and qualified buyers. And yes, there are USDA-eligible areas in Arkansas that may surprise you. It isn’t necessarily synonymous with living in the middle of nowhere.
VA Loans
If you’re an eligible Veteran, active-duty service member or qualifying surviving spouse, your VA home loan benefit can be an incredibly valuable option. VA financing can offer 100% financing with no monthly private mortgage insurance, among other benefits. If you’re eligible for VA, I want you to understand the benefits of using it!
Down Payment Assistance
Some Arkansas buyers may also qualify for down payment or closing-cost assistance programs. Assistance isn’t automatically the right answer for every buyer, though. We need to compare the entire loan, not just the amount of money needed upfront.
Step 5: Understand How Much Cash You’ll Actually Need
Let’s kill the “I need 20% down” myth now. You may not. But your down payment isn’t the only potential upfront expense either.
Depending on your transaction, you may need money for things like: • Earnest money • Home inspection • Appraisal • Down payment • Closing costs • Prepaid taxes and insurance Some of those costs may be negotiable or structured differently depending on the loan and transaction. This is why I don’t like giving buyers one random percentage and telling them that’s what they need.
Let’s run the numbers for your situation.
Step 6: Get Preapproved Before You Fall in Love With a House
This part matters. It’s really easy to start scrolling through houses online before talking to a lender. Then you find THE house.
Now we’re trying to figure out financing while you’re emotionally attached to a kitchen. Let’s do this in the opposite order. A solid preapproval gives you an idea of your price range, estimated payment, cash needed and financing options before you’re trying to make an offer.
It also gives your Realtor something much stronger to work with when it’s time to write that offer.
Step 7: Find the Right Realtor
Your lender handles the financing side. Your Realtor helps you navigate the actual home search, offer, negotiations and transaction. A good lender/Realtor team should communicate with each other throughout the process instead of making you play telephone between everyone.
If you don’t already have a Realtor, that’s okay. I work with agents throughout Arkansas and can help connect you with someone who fits what you’re looking for.
Step 8: Start House Hunting
Now we get to the fun part. But remember the payment conversation from earlier. A $300,000 house does not always have the same monthly payment as another $300,000 house.
Property taxes, homeowners insurance, HOA dues and even the condition or type of property can affect the bigger financial picture. Before you write an offer, I can run the numbers on the specific house so you aren’t guessing.
Step 9: Your Offer Gets Accepted. Now What?
First: celebrate. Then things start moving pretty quickly. Your exact process will vary, but this is generally when we start working through things like: • Finalizing your loan application • Providing updated documents • Inspection • Homeowners insurance • Appraisal • Title work • Underwriting • Final loan approval
You aren’t expected to know what comes next. That’s our job. I walk my clients through the process so you know what we’re waiting on, what I need from you and what’s happening behind the scenes.
Step 10: Please Don’t Buy the Furniture Yet
You’ve made it this far. Don’t celebrate by financing a living room set. Until your loan is completely closed, talk to your lender before making major financial changes.
That includes things like: • Opening a new credit card • Financing furniture • Buying a vehicle • Changing jobs • Moving large amounts of money between accounts • Depositing large amounts of cash • Co-signing for someone else • Paying off debts without discussing it first If you’re wondering whether something matters, ask. I’d rather answer a question that turns out to be nothing than find out about a major financial change three days before closing.
Step 11: Closing Day
Before closing, you’ll receive final information showing the terms and costs associated with your loan. You’ll also receive instructions for anything you need to bring or complete. And one important reminder: wire fraud is real.
Always verify wiring instructions through a trusted contact and phone number before sending money. Never assume an emailed change to wiring instructions is legitimate. Once everything is signed and the transaction is complete, you officially get to call yourself a homeowner.
What If I’m Not Ready Yet?
Then we start there. Seriously. You don’t have to wait until your credit is perfect, you’ve saved some magical amount of money and you’ve learned everything there is to know about mortgages.
Maybe you’re ready now. Maybe you’re three months away. Maybe we need a longer-term plan.
The first step is simply finding out. I’d much rather tell you exactly where you stand and what your options are than have you spend another year wondering whether you could buy a house. I’m Kayla Moore, an Arkansas Mortgage Advisor serving buyers throughout Northwest Arkansas, Central Arkansas and beyond. I also work with buyers in Oklahoma and Missouri.
If homeownership is somewhere on your radar, even if you aren’t sure you’re ready yet, let’s figure out what your next step actually needs to be. Know Moore. Worry Less.
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