How Much Money Do You Really Need to Buy a Home?

One of the biggest questions first-time buyers ask is, “How much money do I need to buy a home?” Budgeting properly can help you avoid surprises along the way. Let’s break down all the costs involved in buying a home.

Down Payments: FHA, VA, and Conventional Loan Options

Depending on the loan type, your down payment requirements will vary:

• FHA Loan – As little as 3.5% down

• VA Loan – No down payment required (for eligible military and veterans)

• Conventional Loan – 3-5% down (or 20% to avoid private mortgage insurance)

Closing Costs: What’s Included and How to Estimate

Closing costs typically range from 2-5% of the home’s purchase price. These include lender fees, appraisal costs, title insurance, and escrow fees.

Additional Expenses: Home Inspections, Moving Costs, and HOA Fees

• Home inspection: $300-$500 (varies by location)

• Moving costs: Hiring movers or renting a truck

• HOA fees: If buying in a community with a homeowners association