
January 24, 2025
Buying Your First Home
With more first-time home buyers hunting for new construction options, builders in the master-planned community of Looking Glass have been personalizing ranch-style and two-story designs for a variety of lifestyles and budgets.
Surprised By the Detail
If you’ve never applied for a mortgage loan, the idea of taking on serious debt to move into your dream house sounds like a daunting proposition. But, says Eric Richter, Mortgage Loan Officer at Gateway Mortgage, it doesn’t have to be.

To get an idea of what first-timers can expect when leaving the rental world for homeownership, we asked Eric what his newest clients are most surprised by when they begin the loan approval process.
“I would say it’s by how in-depth the review can be,” he said. “We look at everything, from their two-year job history, credit history, asset movement, large purchases, and large deposits, to name a few.”
Credit history includes the all-important credit score (check yours for free at Experian!).

“On a conventional loan, you want at least a 620,” says Eric, “but more than likely you will want a 720 or above.”
“Your credit score impacts both the intertest rate and the PMI (Private Mortgage Insurance) on a conventional loan; the higher the score, the better the rate and lower PMI you will qualify for. Anything 720 or above will typically see the best rates.”
First Things First: Monthly Payments

Eric starts new clients off by focusing on the monthly payment they can afford and then looks at the cash a buyer has to put down. “Everything revolves around the monthly payment, especially for first time home buyers,” he says. “They’re coming from renting an apartment or house for maybe $2,000 a month, to owning a house for $3,000 a month,” he says.
That $3,000 a month, Eric tells his clients, includes long-term equity, escrow, homeowners’ insurance and taxes and is different than sending a check to a landlord every month. “We also go through all their goals: (location), timeframe, purchase price, but most importantly, their budget and a comfortable monthly payment,” he says.
A $500,000 Purchase Price

The Denver Post reports a current median home price of $580,000 but for the sake of simplicity Eric used a $500,000 purchase price to do some quick calculations. Using a debt-to-income ratio to determine how much house a buyer can afford, Eric says Gateway allows up to 55 percent of the buyer’s gross income-over-debts (including the new mortgage payment).
For an FHA mortgage loan (great for home buyers with a lower credit score or less money to put down) of $500,000 and zero debt, a buyer would need a combined gross annual income of $95,000. Another applicant for a $500,000 loan with a $500 car payment and $500 in credit card payments, would need a combined annual income of $120,000 to qualify for the loan.
“You can see how quickly that (gross income requirement) rises with just having standard debts,” Eric says. “And it’s been an expensive world to live in the last few years.”
Interest Rates Holding Steady
At Gateway, for a 30-year conventional loan, today’s interest rates are right around 7.0 percent, with an FHA rate around 6.375 percent.

For an aspiring home buyer who wants that $500,000 home and has $120,000 in income, with 3 percent down — their payments would be about $3800 a month.
“The 10-year treasury, that’s what we really watch,” says Eric. People think mortgage rates are dictated by the Federal Reserve and that’s not true, even though it has an impact. “When the 10-year treasury yield goes up, mortgage rates go up. When it goes down, mortgage rates go down,” Eric said. The other factor is that rates are volatile.
“I’m a big advocate for finding a (rate and payment) scenario that works for you with the idea that you can always refinance that later,” he added. “Lock it in, be safe and don’t gamble on your most costly monthly expense.”
And while Eric supports rate-shopping with different lenders, he also recommends, especially for first time home buyers, to research the lenders’ solvency and reputations.
Buying New at Looking Glass

The builders in the master-planned community of Looking Glass have partnered with affiliated lenders to provide competitive loan products for their new construction homes. Visit the sales offices of Taylor Morrison, D.R. Horton, and/or Dream Finders to find out more. Living in this Parker community offers access to parks, trails, an amenity center plus nearby recreation, entertainment and shopping opportunities.