April is Financial Literacy Month—and Dupaco Credit Union is celebrating with a weeklong press series designed to empower and inform. From April 14-18, we’ll be releasing a new topic each day focused on helping take control of your personal finances. This five-part series will cover timely, relevant insights from the experts at Dupaco. Follow the series and catch up anytime at dupaco.com/newsroom.
Dubuque, IA – Buying your first home can feel overwhelming—it’s often the largest purchase a person will ever make. From unfamiliar terminology to complex steps and major financial decisions, the process is filled with unknowns. Whether you’re just beginning to explore the idea or already actively house hunting, understanding the homebuying journey can make all the difference. As prime homebuying season gears up, Dupaco Credit Union has compiled expert insights and answers to common questions—to help you move forward with confidence, every step of the way.
As someone prepares to buy their home, Krystal Frederick, AVP, Mortgage Lending at Dupaco, provides a few tips to help homebuyers prepare for their initial conversations with their lender.
Downpayment
“Downpayments on fixed-rate home loans typically range from 3%-20% of the purchase price,” said Frederick. “If the down payment is less than 20%, homebuyers will need private mortgage insurance (PMI).”
PMI protects the lender incase a homebuyer defaults on their loan. “PMI can be costly, especially since it doesn’t go towards their mortgage. There are ways we can get creative to help homebuyers avoid paying PMI, including offering a second home loan option. This is also known as an 80/15.” Frederick said that while this option isn’t available in each situation, it is a lever that can be looked into for certain situations.
Monthly expenses
A home loan is a years-long commitment. And homebuyers need to make sure they enjoy the home without feeling overwhelmed by the monthly expense. It’s important that homebuyers understand that a typical monthly mortgage payment could include principal, interest, homeowner’s insurance, property taxes and potentially PMI.
“One tip I always suggest to new homebuyers is if buying a home would increase their total monthly payment, for example, from $1,000 to $1,500, set up an automatic transfer for that extra $500 each month and stick with it for at least three months,” said Frederick. “Then, ask yourself how easy or difficult that was and make adjustments from there.”
Credit score
Maintaining good credit is key for accessing the best financing options. While each situation is unique, 620 is the minimum credit score eligible buyers need for a Dupaco fixed rate home loan. However, lenders also consider other factors like income, savings and debts to determine eligibility.
“It’s important to not make any big changes to your credit,” says Frederick. “Avoid big credit card purchases, new credit inquires and closing out any revolving credit accounts because these can impact your credit score, which could impact the rate that you lock in for your mortgage.”
Pre-Approval
Getting pre-approved for a home lets you know how much you can borrow based on your income and existing debt. “This also lets sellers know you’re a serious buyer who can comfortably make an offering without rushing to secure financing,” said Frederick.
Homeownership is a big step, but it doesn’t have to be overwhelming. With expert guidance and smart tools from Dupaco, first-time buyers can feel confident and prepared. Whether you’re just starting out or ready to make an offer, we’re here to help. Visit dupaco.com/home-loans to connect with a mortgage expert and access resources to make your homebuying journey simple and stress-free.
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ABOUT DUPACO COMMUNITY CREDIT UNION
Dupaco Community Credit Union is a not-for-profit, member-owned financial cooperative headquartered in Dubuque, Iowa. It is dedicated to the financial well-being of its members, and specializes in personalized financial counseling, money advice and education. It offers savings, loans, investments, insurance and wealth management products for individuals and businesses. Dupaco serves residents in 118 counties throughout Iowa, northwest Illinois and southwest Wisconsin. Founded in 1948 by ten Dubuque Packing Company employees, membership has grown to more than 173,000 with assets exceeding $3.5 billion. It has over 600 employees and 23 branch office locations. It is a Forbes Best-in-State Credit Union, Forbes America’s Best Small Employer, and a Des Moines Register Top Workplace. Learn more at www.dupaco.com.
