How much money do I need to buy a house?

For a 20% down conventional loan on a $400k home, total upfront cash is typically $95k-$110k (24-28% of price). This includes down payment ($80k), closing costs (~$12k), inspection, appraisal, title insurance, prepaid taxes and insurance, plus moving and immediate repairs.

What are closing costs?

Closing costs are fees paid at loan closing: loan origination, underwriting, processing, title services, escrow, recording fees, prepaid items, etc. Typically 2-5% of purchase price. Get a detailed Loan Estimate from your lender within 3 days of applying.

Can I roll closing costs into the loan?

Sometimes — depends on loan type and lender. Conventional and FHA loans usually allow seller-paid closing costs (up to 3-6% of purchase price) but you generally can't roll your own closing costs into the loan. Higher purchase price may include closing costs as 'lender credits' in exchange for higher rate.

How much down payment do I need?

Conventional loans: 3-20%+ (PMI required under 20%). FHA: 3.5% minimum. VA: 0% (veterans). USDA: 0% (rural). Larger down payment = lower monthly payment, no PMI, more equity, better rates. Most first-time buyers put 5-10% down.

What is an appraisal and inspection?

Appraisal ($400-$700): independent valuation of the home for the lender to confirm it's worth the loan amount. Inspection ($300-$700): independent home inspection for the buyer to identify defects. Both are different and both are recommended.

What is title insurance?

Title insurance protects you and the lender against legal claims on the property's title (liens, ownership disputes, missed heirs). Two policies: lender's policy (required, paid by buyer) and owner's policy (optional but recommended). Total cost varies by state, $500-$3,000+.

Why do I need to prepay taxes and insurance?

Lenders require an escrow account to ensure property tax and insurance are paid. At closing, you typically prepay 6 months of property tax + 12 months of home insurance. The lender then collects 1/12 of each with your monthly payment.

Should I save for repairs?

Yes — budget 1-2% of purchase price annually for ongoing maintenance, plus $5k-$10k for immediate post-purchase needs (paint, appliances, repairs the inspection found). Even 'move-in ready' homes always need something.

Home Buying Cost Calculator

Most first-time buyers underestimate the upfront cost of buying a home. Beyond the down payment, you need 2-5% in closing costs, plus inspection ($500), appraisal ($600), title insurance ($1,500), 6 months of property tax in escrow, 12 months of home insurance prepaid, moving costs, and budget for immediate repairs. For a $400k home with 20% down, total upfront cash typically runs $95k-$110k. This calculator breaks down every component so you know exactly how much to save.

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calendar_today Updated: April 2026

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keyPurchase Details

Purchase Price

Down Payment %

Closing Costs %

Property Tax %

Inspection

Appraisal

Title Ins

Insurance/yr

Moving

Repairs

savingsCash Required

Total Upfront Cash

$99,500

24.88% of purchase price

Breakdown

Down Payment:$80,000

Closing Costs:$12,000

Inspection + Appraisal:$1,100

Title Insurance:$1,500

Prepaid Tax (6mo):$2,200

Prepaid Insurance:$1,200

Moving:$1,500

Repairs:$0

Loan Amount

$320,000

Input Values

Purchase Price

Down Payment %

Closing Cost %

Annual Property Tax %

Annual Home Insurance

tips_and_updates Tips

• Budget 22-28% of purchase price in cash for a 20% down conventional loan
• Closing costs are 2-5% of purchase price — get a detailed Loan Estimate
• Inspection ($300-$700) is non-negotiable — never skip
• Title insurance varies by state; can be $500-$3,000+
• First-time buyer programs may reduce some costs (FHA, VA, USDA)
• Set aside $5k-$10k for immediate repairs and furnishings
• Don't drain savings — keep 3-6 months emergency fund AFTER closing

functions Formula

{Total Upfront = Down Payment + Closing Costs + Inspection + Appraisal + Title + Prepaid Tax + Prepaid Insurance + Moving + Repairs [{Down Payment Property price × down payment %} {Closing Costs Typically 2-5% of purchase price (loan, escrow, fees)} {Prepaid Tax ~6 months property tax held in escrow} {Prepaid Insurance First year home insurance paid at closing}] The 'true' cost of buying a home is roughly 22-30% of the purchase price for a 20% down conventional loan. The down payment is the biggest line item, but the supporting costs add up to thousands more. First-time buyers should budget for 23-28% of purchase price in cash.}

science Example: $400k home, 20% down, 3% closing costs

$400k × 20% down = $80k. Plus $12k closing (3%) + $500 inspection + $600 appraisal + $1,500 title + $2,200 prepaid taxes + $1,200 prepaid insurance + $1,500 moving = $99,500 total cash needed. That's nearly 25% of the purchase price — well above the 20% most buyers focus on.

Expected Results

Total Upfront Cash $99,500

Down Payment $80,000

Loan Amount $320,000

Closing Costs $12,000

Prepaid Property Tax $2,200

Prepaid Insurance $1,200

Upfront as % of Purchase 24.9%

How to Use This Calculator

Enter purchase price

Home price you're considering.

Set down payment %

20% to avoid PMI; less is OK with caveats.

Set closing cost %

Get a Loan Estimate from your lender for accuracy.

Add property tax + insurance rates

For prepaid escrow calculations.

Optional fees

Inspection, appraisal, title, moving, repairs.

See total cash needed

Often 22-28% of purchase price.

The Formula

The 'true' cost of buying a home is roughly 22-30% of the purchase price for a 20% down conventional loan. The down payment is the biggest line item, but the supporting costs add up to thousands more. First-time buyers should budget for 23-28% of purchase price in cash.

Total Upfront = Down Payment + Closing Costs + Inspection + Appraisal + Title + Prepaid Tax + Prepaid Insurance + Moving + Repairs

lightbulb Variables Explained

Down Payment Property price × down payment %
Closing Costs Typically 2-5% of purchase price (loan, escrow, fees)
Prepaid Tax ~6 months property tax held in escrow
Prepaid Insurance First year home insurance paid at closing

tips_and_updates Pro Tips

Budget 22-28% of purchase price in cash for a 20% down conventional loan

Closing costs are 2-5% of purchase price — get a detailed Loan Estimate

Inspection ($300-$700) is non-negotiable — never skip

Title insurance varies by state; can be $500-$3,000+

First-time buyer programs may reduce some costs (FHA, VA, USDA)

Set aside $5k-$10k for immediate repairs and furnishings

Don't drain savings — keep 3-6 months emergency fund AFTER closing

Frequently Asked Questions

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