1. Down Payment

Many buyers assume they need 20% down to buy a home, but that’s not always true. In fact, most people put down much less:

• Conventional loans: As little as 3% down for qualified buyers
• FHA loans: Minimum of 3.5% down
• Special programs: Some buyers may qualify for 0% down through state or national assistance programs

The right loan program depends on your income, credit history, and other factors. Working with a knowledgeable mortgage professional can help you understand all your options.

2. Earnest Money Deposit

An earnest money deposit is a payment you make when submitting an offer on a home. It shows the seller you’re serious and can help your offer stand out in competitive markets.

Here’s what to expect:

• Typically 1%–2% of the home’s purchase price
• Held in escrow until closing
• Applied to your down payment or closing costs

This deposit isn’t a separate fee; it’s part of your homebuying funds. Your real estate agent can help you determine how much is appropriate in your local market.

3. Closing Costs

Closing costs are the third major expense to plan for. These fees cover a range of services involved in finalizing your home purchase, including:

• Loan origination and underwriting fees
• Appraisal and credit report
• Title search and insurance
• Property taxes and homeowners’ insurance (prepaid)

Most buyers can expect closing costs to be 2% to 5% of the purchase price. Your lender will give you a detailed estimate early in the process so you’re not caught off guard at the closing table.

Bottom Line

Being prepared for your down payment, earnest money, and closing costs helps you move forward with confidence and avoid last-minute surprises. Every buyer’s financial situation is different, and that’s where expert guidance matters most.

Click here to start your application or reach out for a personalized homebuying plan. I’m here to help you understand the numbers and make smart financial decisions from day one.