I've been saving and paying off debt. I currently have about 30% of what I think a 20% down payment will be. My credit score was in the mid 500s as of a year ago, and I'm at ~680, now. My wife is ~740.

Anyway, any advice for a prospective homeowner? Should I look into 1st time homeowner loans, or try and save the 20% for the down payment, and avoid that type of loan all-together?

How does school debt look to a lender? I still have ~$16,000 to pay off.

As far as a lender is concerned debt is debt. Student loans affect your ability to repay a loan just as much as a car loan would. Technically they might view student loans worse than a car loan, because at least a car loan is "secured" by a physical object. It's pretty tough to repo a diploma.

That being said, a 680 and a 740 should qualify you for just about any loan you would apply for (within the parameters of affordability).

30% of a 20% downpayment... so 6% of your expected purchase price? I would continue saving and look into 80/10/10 loans. Alternatively, you could look into some of the 3%, 5%, or 0% down loans for first time home buyers, but expect that you're going to have to pay PMI if you do that.

Student loan debt is what I consider "good debt" so it's better than owing $16,000 on a few credit cards.

The longer you wait, the more expensive your first home will be. It's worth at least applying to see if you get approved. Some banks and credit unions hold free first time home buyer workshops, I highly recommend you attend one of these.

In the olden days you'd have to save up 20% to avoid PMI but there are so many new products. If you qualify you could get a 100% (80/20) without having to save up 20% first.

I'll have to check into a CU. Another dilemna I have is that I work in the IT dept of a local bank. I could talk to a loan officer here, but I know our rates and fees are not that good. Of course, once I do buy a house, everyone will know it and know that I didn't take my loan out here.

You could always tell them that you didn't take your loan out there because you felt it would be a conflict of interest. Besides, they already have access to your salary and health records, why give them the rest of your financials? (Although working IT at a bank, I'd guess they already pull semi-regular credit reports on you...)

if you want a good rate, you may look for a broker. They usually work with multiple lenders and thus can give you the better deal. Ask around your friend or family whether they know one.

My sister is a lender broker, and pm me if you need her contact info.