Buying your first home in Oregon

Three things that aren't true

"I need 20% down"

You don't. Conventional loans go down to 3% for qualified first-time buyers, FHA is 3.5% at a 580 credit score, VA is zero down if you're eligible, and USDA is zero down in eligible rural areas (which rules out Portland proper, but does include real parts of Clackamas, Columbia, Yamhill and Marion counties).

Twenty percent does avoid mortgage insurance, and that's a real benefit, so I'm not going to talk you out of it. But it isn't an entry requirement, and waiting years to accumulate it while prices and rents keep climbing is very often the more expensive choice.

"My credit needs to be perfect"

580 gets you FHA at 3.5% down. 500 to 579 can still work at 10% down, and conventional generally starts around 620. Better credit does get you better pricing, and the difference is not small, but the floor is much lower than most people assume, and a 640 score today usually beats a 720 score two years from now if prices move in between.

"I should wait for rates to drop"

This is the expensive one, and I'd rather be straight with you than sell you urgency, so here's the honest answer. Nobody knows. Fannie Mae's August 2026 forecast has rates averaging around 6.8% into mid-2027, and that forecast was revised up from the month before it. I've been watching rate forecasts for twenty-two years now, and I wouldn't plan a life around one.

Bottom line, buy when your situation is ready rather than when the market is, because if rates fall later you refinance, and if they don't, you own a house you would otherwise have been renting.

Which loan fits

The FHA-versus-conventional decision is worth more than most rate shopping. FHA's monthly premium generally sticks for the life of the loan when you put less than 10% down, while conventional mortgage insurance comes off automatically at 78%. Over ten years that gap frequently outweighs a quarter-point difference in rate, and it's the comparison almost nobody runs for you.

Down payment assistance in Oregon

These programs are real, the money in them is meaningful, and they're chronically underused, mostly because they're hard to find and the rules keep changing.

• Oregon Housing and Community Services offers down payment assistance up to $60,000 or 20% of the purchase price, whichever is less, for first-time and first-generation buyers at or below 100% of area median income. Homebuyer education and counseling are required.
• Portland Housing Bureau runs a Down Payment Assistance Loan of up to $80,000–$100,000 depending on funding source and location, at 0% interest, deferred for 30 years. First-time buyer, at or below 100% of Portland area median income, HUD-approved education required, and applicants must be a U.S. citizen or legal resident.
• Arrive (formerly Portland Housing Center) has been doing HUD-certified homebuyer counseling in Oregon for 35+ years, runs matched-savings programs, and is a non-commissioned lender in its own right. They're worth talking to whether or not you ever work with me.

Should you wait?

Sometimes the answer is yes, and I'd rather tell you that than put you into a house you end up regretting.

Wait if: you might move within two or three years (the rent-vs-buy math usually favors renting on that kind of horizon), or your job is unstable, or you've got high-rate debt eating your budget, or you'd be closing with nothing left in reserve, which is how a water heater turns into a crisis.

Don't wait if: you're mainly waiting on rates, or on 20% down, or on your credit reaching some imagined threshold. Those are the three reasons people give me for waiting, and all three of them are usually wrong.

What to actually do first

1. Get a real pre-approval before you look at houses. I don't mean a calculator or an online estimate, I mean an actual review of your documents and your credit. Sellers in this market don't take an offer seriously without one, and you'll be shopping with real numbers instead of with hope.
2. Don't open new credit. Not a car, not a furniture card, and not a "no interest" financing offer either, so just wait until after closing. This one derails more first-time purchases than anything else on the list.
3. Leave your down payment alone. Large recent deposits have to be sourced and documented, so move the money into place early and then let it season.
4. Ask about assistance programs early, because of that timeline problem above.
5. Get an insurance quote sooner than feels necessary. Premiums have been moving fast, and a surprise there can change your debt-to-income ratio late in the process, right when you can least afford it.

Common questions

How much do I need saved in total?

Down payment plus closing costs plus a cushion. Closing costs in Oregon typically run 2–5% of the purchase price, though sellers frequently pay part of them and some can be rolled into the rate. On a $450,000 purchase at 3.5% down you're realistically looking at $30,000–$40,000 all in, and less than that with assistance.

Am I still a first-time buyer if I owned a home before?

Usually yes, if you haven't owned in the past three years. That's the standard definition for most of these programs, and it surprises a lot of people who had already counted themselves out.

Does a pre-approval hurt my credit?

It's one hard inquiry, typically worth a few points. And all mortgage inquiries within a 45-day window count as one for scoring purposes, so you can and should compare lenders without stacking up damage.

What if I get declined?

Then we find out exactly why, and usually it turns out to be fixable. A decline from a bank or a credit union frequently means the loan didn't fit their short list of programs, which is a completely different thing from you not qualifying. Sorting that out is most of what I do.

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Program amounts and eligibility described here reflect published Oregon Housing and Community Services and Portland Housing Bureau materials and change without notice — confirm current terms with the administering agency. Loan program requirements are typical rather than guaranteed. Not a commitment to lend.