How Much $ Money Do You Actually Need to Buy a House?

**This article was co-written by
Abby Fitzsimmons, Realtor and Pete Griffin, Loan Officer, NMLS: 1227655. **

If you are like me, you have grown-up hearing that you need to have 20% to put down in order to buy a house. Let’s say you want to buy a house for $350,000. That would mean you need to have $70,000 saved up!! That’s easily a couple of cars!

What if I told you that this is not the case in the majority of home sales? In fact, a 2018 report from the National Association of Realtors reported that 72% of first-time home buyers put less than 6% down on their first mortgage. We just cut that $70,000 down to $21,000.  But it gets even better…There are financing options available to a large number of home buyers that require NO down payment! For active duty members and Veterans of the Armed Forces, the Department of Veteran’s Affairs (The VA) offers home loans with 100% financing ($0 Down Payment).

What if you are not a military veteran? Nope! You still don’t need 20% to put down. There are programs that are backed by the US Department of Agriculture (USDA) and the Virginia Housing Development Authority (VHDA) that will offer 100% financing to qualifying buyers.  Additionally, VHDA offers qualifying first-time home buyers a down payment assistance grant that can be used towards the purchase of a home.  This program lowers the new buyer’s down payment to 1% ($70,000 is now down to $3,500).

Now, you
will need some money to buy a home, but it’s not 20%! Costs to keep in mind
that you will need immediate funds for are:

  • An earnest money deposit (to show the seller that you are serious about the purchase)
  • A home inspection, a well and septic inspection (in some cases), a wood-destroying insect inspection
  • An appraisal
  • Any buyer’s closing costs not covered by the seller (Note: in many cases, the seller may pay up to 100% of the buyer’s closing costs)

Don’t get
me wrong…putting 20% down is still a great goal, and it comes with lots of its
own benefits.  The greater your personal
investment is in your home, the lower the risk is for the lender providing the
difference.  Interest rates are often
better the more you put down, and most importantly, most lenders do not require
mortgage insurance on the loan once you have established 20% equity in the

Bottom Line: don’t stress about not having 20% to put down on a home.  It is really not that common.  In fact, many of the first-time home buyer programs discussed here are built for the more common buyer who doesn’t happen to have $70,000 in their back pocket.  Your dream of home ownership is closer than you think!

For more information about first-time home buyer programs, or home ownership in general, feel free to contact us directly, or simply provide your comment or questions below.

*Movement Mortgage, LLC supports Equal Housing
Opportunity. NMLS ID #39179 ( |
877-314-1499. Movement Mortgage, LLC is licensed by VA – MLO-21348VA,VA –
MC-5112. Interest rates and products are subject to change without notice and
may or may not be available at the time of loan commitment or lock-in.
Borrowers must qualify at closing for all benefits. “Movement Mortgage” is a
registered trademark of the Movement Mortgage, LLC, a Delaware limited
liability company. 8024 Calvin Hall Rd, Indian Land, SC 29707