Three Ways to Make Mortgages More Affordable

Owning a home has long been an emblem of the American Dream. But many adults now believe it’s a dream that will never be a reality. 

Twenty-three percent of adults feel homeownership is out of reach, and 40% of adults who don’t currently own a home believe buying one in the future will be impossible, according to CNBC and SurveyMonkey’s Quarterly Affordability Survey. (Read more about the survey’s methodology here.)

On the other hand, over half of adults are hopeful about their future homeownership prospects. A fifth of all adults who don’t currently own a home are confident they will be able to in the next five years and another third think it may be possible.  A tenth of adults are simply uninterested in homeownership.

It’s understandable that so many people have become pessimistic about homeownership. The median cost of a home jumped 52% between the first quarter of this year and the same period in 2020, reaching $534,000, according to the Federal Reserve Bank of St. Louis. Income has not risen as steeply — a pattern that has persisted for the past 40 years, per Federal Reserve Economic Data. 

Look at how much faster home prices have grown since 1986 compared to median household income: 

While homeownership has become more expensive, many Americans can still achieve it, albeit not as easily as their parents did. 

There are three major barriers to becoming a homeowner: Insufficient down payment savings, a less-than-perfect credit score and inadequate income to cover payments. 

CNBC Select is here to help you find solutions to those issues so homeownership feels possible — with the right loan type, help with a down payment and an understanding of how much you can afford, you’ll be better prepared to find a home and financing option that works for you.

A less-than-perfect credit score is a major reason Americans feel they can’t afford homeownership, and FHA loans can be a great solution. 

You can apply with a credit score of 500 or higher if you make a down payment of 10% or more, or with a credit score of 580 or higher if you make a down payment of 3.5% or more.

Additionally, these loans offer lower-than-average rates. For example, as of April 10, the 30-year fixed-rate FHA loan rate was 5.91%, while the conventional 30-year fixed-rate mortgage was 6.39%, according to Mortgage News Daily. Two of our top FHA loan picks are Rocket Mortgage and Pennymac. 

Rocket is one of the largest FHA lenders in the country and consistently ranks highly in J.D. Power’s customer satisfaction surveys. 

However, if you prefer to handle your mortgage in person, you’ll need to go elsewhere because Rocket has no physical retail locations. 

Pennymac is known for its low rates. You can also receive $1,000 toward your closing costs through the BuyerReady Certification preapproval process.

For VA loans, Veterans United is a great choice. It ranks highly in J.D. Power’s customer satisfaction survey.

However, there’s little information on non-VA options, which may make it hard to compare if you’re still considering a conventional mortgage. 

If you’re buying a property that qualifies you for a USDA loan, we recommend Guild Mortgage. You can apply for a Guild Mortgage using non-traditional credit sources, such as on-time rent or utility payments. It accepts applicants with a credit score of 540 or higher, which is much lower than most lenders require.

One downside is that Guild doesn’t lend in New York. 

Freddie Mac created an online portal for down payment assistance programs at the local, state, and national levels called DPA One. You can search by your personal criteria and compare options on the website. 

Another option is to look for lenders that offer products geared toward down payment assistance.

ONE+ by Rocket Mortgage is a great example. With this loan, Rocket Mortgage will provide 2% of the purchase price to qualifying borrowers to use toward a down payment, making at or below 80% of the area median income if they put 1% to 2.99% down. 

The first thing you should do is figure out how much you can actually afford. The Department of Housing and Urban Development uses the 30% rule to determine whether an individual is housing cost-burdened. That means that all of your housing costs should be at or below 30% of your gross income.

To calculate what this is for you, you’ll want to take your gross income and multiply it by 0.3. Next, divide that number by 12. That’s what you can comfortably afford to pay for all housing expenses, including rent or a mortgage, utilities, homeowners insurance, property taxes, and mortgage insurance (which could be $200 to $600 extra on top of rent or a mortgage). 

Next, use that formula as a guidepost and plug the information into our calculator to see what you can afford. 

If you can’t find a suitable home in your price range where you live, there may be other options elsewhere. For example, the National Association of Realtors compiled a variety of data points—including home prices relative to household income—to identify the 10 best places for first-time homebuyers to live. 

You may have a better chance of finding a home you can afford in Rust Belt cities like Rochester, New York, or Garfield Heights, Ohio, where the cost of owning a home is lower relative to what people earn in the region than in most other places. 

The data referenced in this article were results from the CNBC and SurveyMonkey Quarterly Money Survey on Affordability released in April 2026.

Here is the methodology SurveyMonkey used to come to these findings: “The SurveyMonkey study was conducted March 23, 2026 to March 25, 2026 among a sample of 3,494 adults in the U.S. Respondents for this survey were selected from a non-probability online panel. The modeled error estimate for this survey is plus or minus 2.0 percentage points. Data have been weighted for age, race, sex, education, and geography using the Census Bureau’s American Community Survey to reflect the overall demographic composition of the United States.”

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