Home Financing Playbook
The full mortgage lifecycle, in order — with free calculators and a printable plan
Start with your one-page plan
The Mortgage Action Plan turns your income and down payment into a printable Go/No-Go.
The home-financing lifecycle
| Phase | Lead question | Free tools |
|---|---|---|
| 1 · Affordability | What price fits the 28/36 rule? | Affordability, DTI Ratio |
| 2 · Term | 15 or 30 years? | Mortgage, 15 vs 30 |
| 3 · ARM vs fixed | How long will I stay? | Mortgage, APR |
| 4 · Compare lenders | Shop 3–5 Loan Estimates | Comparison Worksheet |
| 5 · Closing costs | Budget 2–5% on top | Action Plan |
| 6 · Extra payments | Pay down faster? | Extra-Payment Sim |
| 7 · Refinance | Worth it after breakeven? | Refinance Breakeven |
The numbers that drive the plan
| Factor | Value | Why |
|---|---|---|
| 28/36 rule | Housing ≤28% / total debt ≤36% of gross income | The conventional underwriting benchmark. |
| 43% QM cap | Back-end DTI ceiling for most Qualified Mortgages | FHA/VA/USDA and some portfolio lenders go higher with factors. |
| 30-yr fixed avg | ~6.6% (Aug 2026) | Your rate depends on credit, down payment, loan type. |
| 15-yr fixed avg | ~6.0% (Aug 2026) | Lower rate, higher payment, far less total interest. |
| 5/1 ARM avg | ~6.5% (Aug 2026) | Resets after year 5 — risky for long stays. |
| PMI threshold | Down payment under 20% | Reach 20% to drop PMI and lower the payment. |
| Closing costs | 2–5% of price | On top of the down payment; shop the Loan Estimate. |
National averages retrieved 2026-08-11; your personal rate depends on credit, down payment, loan type, and lender.
Nine mistakes that break a mortgage
Ignoring back-end DTI
Car loans and cards quietly push you past 36% and shrink what you can borrow.
Under-20% down triggers PMI
PMI can add hundreds per month; plan the 20% line to remove it.
Taking the first quote
Shopping 3–5 lenders routinely saves thousands in interest over the loan.
Forgetting closing costs
2–5% on top of the down payment surprises first-time buyers at closing.
ARM reset risk
A 5/1 ARM can jump after year 5 — unsafe if you stay 7+ years.
Comparing rate, not APR
APR includes fees; the cheaper rate can cost more once fees are in.
Skipping the rate lock
Rates move daily; an unlocksd quote can drift before closing.
Omitting taxes & insurance
The true payment is PITI, not principal and interest alone.
Refinancing before breakeven
Only refinance if savings repay the cost within your stay.
Official Standards & Authoritative Sources
Frequently Asked Questions
How do I start the home-financing lifecycle?
Which term should I pick?
When is an ARM better than a fixed rate?
Why compare multiple lenders?
When does refinancing make sense?
Educational reference only. RateFig provides calculators and guides, not a loan offer, credit decision, or financial advice. Mortgage approval depends on credit, income, assets, the property, and the lender’s guidelines. Confirm all figures with a licensed loan officer before acting.
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