First-Time Homebuyers

Resources to help everyone walk through the entire homebuying process, from understanding key terms and finding a mortgage lender, to closing and moving into your first home.

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Key Terms

Frequently Asked Questions

  • How much should I save before buying a house?

    The main factors to save for when buying a house are earnest money—the deposit you make when putting an offer on a home—the rest of your down payment, and closing costs. Most earnest money deposits average between 1% and 3% of the home price, and closing costs average about 2% to 5% of the purchase price of the home. As for the down payment, experts suggest saving at least 20% of the price of the home, but depending on your situation, less than 20% may work too.

  • What are the prepaid costs when buying a home?

    Prepaid costs—also referred to as prepaids—are upfront cash payments that you make in addition to your down payment, in order to obtain a mortgage. These can include property taxes, hazard insurance, private mortgage insurance, and special assessments. They are paid at closing and placed into an escrow account to later cover the expenses related to a mortgage.

  • What costs are involved in buying your first home?

    The biggest costs to plan for when buying your first home include the down payment and the monthly mortgage payments. You will also pay various one-time fees, including those related to closing costs, mortgage application, home inspection and appraisal, and more. Before finalizing your purchase, speak with your real estate agent, lender, or attorney in order to understand all costs involved.

  • What questions should you ask when buying a home?

    Before making an offer on a house, a buyer should ask specific questions about three main things: price, home condition, and location. When asking about location, for example, you may ask about where the nearest schools are located or whether or not the house is in a flood zone.

  • How much money do you need to put a down payment on a house?

    When it comes to the down payment, most experts suggest that you should be willing to put down 20% of the purchase price of a home. While putting 20% down is not the only way to achieve homeownership, when you put that much down, you’ll avoid paying for private mortgage insurance. To calculate the amount you would need for a 20% down payment, multiply your home’s purchase price by 20% (or 0.20).

  • When is the appraisal done when buying a home?

    An appraisal is a process, solidified by a written document, that shows an opinion of how much a property is worth. Typically, the appraisal happens after an offer has been made and the home in question has been inspected. It’s not always required, but recommended. The buyer usually has to pay for and arrange the appraisal, and once it is complete, the final report is sent directly to the lender.

  • What are the tax deductions associated with buying your first home?

    The IRS offers deductions to those who qualify for the prepaid mortgage interest. For instance, the IRS allows certain first-time homebuyers to avoid a specific tax penalty if they withdraw money from an IRA to help pay for their home. In order to qualify, though, you must meet the specific definition that the IRS uses for “first-time homebuyer.”

Real estate agent showing a home to a young couple
How Long Does It Take To Buy a House?
Couple buying a house and closing the deal with the real estate agent
FHA Loan
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Types of Mortgage Loans for Homebuyers
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A First-Time Homebuyer's New Construction Guide
factors that can delay or precent home closing
How Long Does It Take To Close on a House?
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What Is the First-Time Homebuyer's Credit?
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First-Time Homebuyer Programs
what income is needed to buy a house?
How Much Income Do You Need To Buy a House?
Monthly mortgage insurance provided is required on all FHA loans.
FHA Mortgage Insurance: What You Need To Know
Couple buying their first home
First-Time Homebuyer Act of 2021
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A family moves into a home.
How To Find the Best Place To Buy a House
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First-Time Homebuyer Qualifications
Couple signing paperwork in office with lawyer
Buying a Home? Get Help Covering Closing Costs
Real estate agent showing vacant house to a couple
How To Save for a House
Parent holding toddler in front of new home
First-Time Homebuyer Loan
Two people looking at a house for sale with a real estate agent
Pros and Cons of First-Time Homebuyer Loans
Pros and Cons of VA Loans include Pros: Lower costs upfront May offer better rates and lower terms Assumable by new homeowners Consumer-friendly loan terms Cons: Strict service requirements Not offered by all lenders Risky if home values drop
What Is a VA Loan?
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Your Guide To Buying a Townhouse
Real estate agent talking to a couple looking at a house
5 Tips for Making an Offer on a House
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Do You Get a Tax Break for Buying a House?
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How Much Does a First-Time Homebuyer Need for a Down Payment?
A young couple and their dog take a break from unpacking moving boxes to eat pizza on the floor of their new home
How To Qualify for a Home Loan
Real estate salesperson greeting customers while standing outside house
Here’s How To Win a Bidding War on Your First Home
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Steering in Real Estate
Couple surrounded by boxes while moving into new home
What To Know About First-Time Homebuyer Classes
Person working on a laptop at a small pottery business
How To Buy a House When Self-Employed
A couple looks at real estate flyers on an agency window
First-Time Homebuyers: Should You Use Your Roth IRA for the Purchase?
Parent and child lifting moving boxes in a new home
How To Budget for a House
Couple reviewing documents
Buying Your First Home? Check Out These Mortgage Tips
A couple unpacking boxes in living room of new house
Types of Home Loans for First-Time Homebuyers
People discussing paperwork
Fair Housing Act
This illustration describes all about home down payments including "Types of minimum down payments: VA Loans, FHA Loans, Conventional Loans," and "Where you can get money for a down payment: Gifts or loan from family, Personal loan, Withdrawal from retirement accounts, and Sell other assets."
How Much To Put Down on a House
A couple enjoys coffee in a home kitchen.
What Are the Benefits of Being a First-Time Homebuyer?
A parent and infant look out the front door of their home.
First-Time Homebuyer
A woman and a real estate agent holding a document have a discussion in front of a home
Qualified Mortgage
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When Is the Best Age to Buy a Home?
illustration of woman calculating home-buying fees
Fees You Need To Know About When Buying a Home
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Buying a House Online: Where To Look and How To Do It
Smiling, embracing couple in front of new home
Buyer's Market
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Housing Expense Ratio
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What Is the Minimum Down Payment for a Conventional Loan?
A young family takes a break from unpacking moving boxes.
Chase Homebuyer Grant
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How To Buy a House With a Friend
Real estate agent showing a house
What First-Time Homebuyers Should Look for in a Real Estate Agent
Couple embracing in front of new home
Considering Buying a Home Together Before You’re Married? Read This First
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Can You Borrow From Your 403(b) To Buy a House?
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Answers to Common Homeowners Insurance Questions
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How To Choose the Right Location for a Home
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How Does a Mortgage Work?
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Can You Get Out of an FHA Loan?
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What To Consider Before Buying a Duplex as a First Home
how does mortgage preapproval work? fill out a loan application, sign off for a credit check, submit necessary financial documents to lender, if you qualify you'll receive a preapproval letter that is typically valid for a maximum of 90 days
What Is Mortgage Preapproval?
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Can You Borrow Extra on Your Mortgage To Pay for Furniture?
Couple and financial advisor
Buying a House Without a Mortgage? Here’s How To Do It
Young couple on floor of living room, taking a break from unpacking boxes in new home
How Does Down Payment Assistance Work?
woman writing list at desk with laptop
Monthly Home Expenses: How To Budget for a First House
Young girl putting up a painting in her new home
11 Hidden Costs of Home Ownership
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Pros & Cons of Mortgage Down Payment Assistance Programs
Page Sources
  1. U.S. Department of Housing and Urban Development. “Common Questions From First-Time Homebuyers.”

  2. National Association of Realtors. “Upfront Cost of Buying a Home.”

  3. H&R Block. “Tax Deductions For Home Purchase.”