How much do first-time homebuyers need for a down payment?

First-time buyers can put down as little as 3% with a conventional loan or 3.5% with an FHA loan. VA and USDA loans offer 0% down payment options for eligible borrowers. Many state and local programs also offer down payment assistance grants.

What credit score do I need to buy my first home?

FHA loans require a minimum 580 credit score for 3.5% down, or 500 with 10% down. Conventional loans typically need 620+. Higher scores (740+) get the best rates. Check your score for free at AnnualCreditReport.com.

What are closing costs for first-time buyers?

Closing costs typically range from 2-5% of the purchase price. On a $350,000 home, expect $7,000-$17,500 in closing costs including lender fees, title insurance, appraisal, and prepaid taxes and insurance.

Are there special programs for first-time homebuyers?

Yes, many federal, state, and local programs offer benefits like down payment assistance, reduced interest rates, and tax credits specifically for first-time buyers. FHA, VA, USDA, and state housing finance agency programs are the most common.

First-Time Homebuyer Guide: Your Complete Roadmap to Homeownership

Everything first-time buyers need to know — from saving for a down payment to closing day. Step-by-step guidance to navigate the mortgage process with confidence.

First-Time Homebuyer Roadmap

Buying your first home is one of the biggest financial decisions you will make. The good news: first-time buyers have access to special programs, lower down payment options, and tax benefits that make homeownership more accessible than you might think. This guide walks you through every step.

3.5%

Minimum FHA Down Payment

620

Min. Credit Score (Conventional)

43%

Max DTI Ratio (Typical)

2-5%

Closing Costs (% of Price)

Step-by-Step Process

Check Your Financial Health

Review your credit score, calculate your debt-to-income ratio, and assess your savings. You will need funds for the down payment, closing costs, and a 3-6 month emergency fund.

Determine Your Budget

Use our affordability calculator to see what you can comfortably afford. Your total housing cost (mortgage + taxes + insurance) should be under 28% of gross income.

Research Loan Programs

Explore FHA loans (3.5% down), VA loans (0% down for veterans), conventional loans, and state/local buyer programs.

Get Pre-Approved

Apply with 2-3 lenders to compare rates and terms. Pre-approval strengthens your offer and shows sellers you are a serious buyer. Compare today's rates.

Find Your Home & Make an Offer

Work with a real estate agent who knows your local market. Make a competitive offer within your pre-approved amount. Include contingencies for inspection and financing.

Close & Move In

Complete the home inspection, appraisal, and final underwriting. Review your Closing Disclosure carefully. Lock your rate, sign the paperwork, and get the keys to your new home.

Best Loan Options for First-Time Buyers

Loan Type	Min. Down	Min. Credit	PMI?	Best For
FHA	3.5%	580	Yes (MIP)	Lower credit scores, smaller savings
Conventional 97	3%	620	Yes	Good credit, want to drop PMI later
VA	0%	620*	No	Veterans and active military
USDA	0%	640	Low fee	Rural and suburban areas

First-Time Buyer Mistakes to Avoid

Not getting pre-approved first — know your budget before house hunting
Skipping the inspection — never waive a home inspection to win a bidding war
Only looking at one lender — comparing 3+ lenders saves an average of $3,000+ over the loan
Forgetting closing costs — budget 2-5% of the purchase price beyond your down payment
Making big purchases before closing — new car loans or credit cards can tank your approval