How Much Money Do I Need to Buy a Home?

You do not necessarily need 20% down to buy a home. The amount you need depends on your loan program, the home, the terms of your offer, and how much savings you want left after closing.

A useful starting point is:

Down payment + closing costs and prepaid expenses − eligible credits = estimated cash needed for the purchase.

Then set aside money for anything you may pay before closing, such as a deposit or inspection, and for moving and unexpected expenses afterward.

I’m Paul Mattos with Refine Mortgage and Carolina Home Financing. Here’s how I help buyers in North Carolina and South Carolina turn that formula into a realistic number.

Start With the Down Payment

Your down payment is the portion of the purchase price you pay rather than finance. Depending on eligibility, common options include:

• Conventional: Some programs allow as little as 3% down.

• FHA: The minimum required down payment is generally 3.5%.

• VA: Eligible borrowers may be able to buy with no down payment.

• USDA: Eligible buyers and properties may qualify for no-down-payment financing.

A smaller down payment can make buying possible sooner, but it may change your monthly payment and mortgage insurance costs. You can read more about conventional home loans and compare the broader options on my home loan programs page.

Add Closing Costs and Prepaid Expenses

The down payment is only one part of the upfront cost. Closing costs may include lender and appraisal charges, title or attorney fees, recording costs, and other charges tied to the loan and property transfer. My guide to closing costs for buyers in NC and SC breaks down each item.

You may also need to prepay homeowners insurance, property taxes, and interest, or fund an escrow account for future tax and insurance bills. As an early planning estimate, the Consumer Financial Protection Bureau says closing costs often run 2% to 5% of the purchase price, separate from the down payment. Your actual amount can be outside that range.

For example, with 3% down and closing costs in the 2% to 5% range, you'd need roughly 5% to 8% of the purchase price before credits. That's a starting range, not a quote for any particular home or loan.

Property taxes, insurance, loan terms, and the closing date can all change the final figure. That’s why I prefer to run an estimate for a specific home before you make an offer.

Know What You May Pay Before Closing

Your final wire is not always the first money you spend.

An earnest money deposit is typically paid after you go under contract and credited toward the purchase if you close. You may also pay for an inspection, appraisal, or other services before closing. Those payments have different refund rules, so review your contract before committing the money. Here’s a closer look at how earnest money works.

North Carolina buyers should pay particular attention to the due diligence fee. Under the commonly used residential contract, it is paid to the seller when the contract is accepted and credited to the buyer at closing. It is generally nonrefundable if the buyer walks away, subject to the contract’s exceptions. The fee is negotiated, and your agent can explain the terms of your particular offer.

South Carolina contracts can be structured differently. In either state, ask which payments are due immediately, which are credited at closing, and what happens if the purchase does not close.

Subtract Credits and Assistance You Actually Qualify For

Several sources may reduce the amount you personally bring to closing:

• Seller credits can cover eligible closing costs and other permitted expenses, subject to program limits and the negotiated contract.

• Gift funds may be allowed for a down payment or closing costs if the donor and transfer meet the loan program’s documentation rules.

• Down payment assistance may be available to eligible buyers, but its terms vary. Some assistance is a loan that may have to be repaid.

A seller credit usually cannot simply replace a required down payment. Assistance is also not automatically free money. We need to check eligibility and how each option affects the complete loan.

If someone is helping you, read my guide to using gift funds for a down payment before transferring money. You can also see how seller credits may lower your upfront costs.

Keep Money Available After You Move In

The amount a lender requires for closing and the amount you feel comfortable spending are two different questions.

Moving costs, utility setup, repairs, and ordinary emergencies do not disappear once you get the keys. Some loan scenarios also require documented reserves after closing. I would rather compare a few down payment options with you than assume every available dollar should go into the house.

Don't Forget the Monthly Costs

The cash you bring to closing is only half the picture. Before you choose a price range, look at the full monthly housing payment, not just principal and interest:

• Property taxes

• Homeowners insurance

• Mortgage insurance, if applicable

• HOA or condo dues

• Flood insurance or other required coverage, if applicable

An online calculator may use rough tax and insurance estimates and leave out HOA dues entirely. In South Carolina, ask the county how to apply for the 4% owner-occupied assessment, since the seller's tax bill may not reflect what you'll pay. Two homes at the same price can have very different monthly costs.

Costs After You Get the Keys

Plan for expenses that come after closing, too: moving, utility setup, window coverings, appliances, lawn care and the first repairs a home needs. An inspection tells you about a home's condition, but it can't predict exactly when the HVAC, roof or water heater will need work.

If you're comparing two homes at the same price, one with HOA dues and higher insurance and one that needs repairs, the asking price won't tell you which costs more. Ask for the estimated cash to close, the full monthly payment and a plan for the savings you'll have left for each one.

How Do You Find Your Real Number?

Once you have a target price, I can estimate the down payment, closing costs, prepaid expenses, and likely monthly payment for several loan options. When you find a particular home, send me the listing so I can look more closely at its taxes, insurance considerations, and any HOA dues.

The Estimated Cash to Close on your Loan Estimate shows how your down payment and closing costs are adjusted for deposits, seller credits, and other items. It is an estimate; your final Closing Disclosure will show the closing figures.

If you’re planning to buy in North Carolina or South Carolina, let’s work backward from both numbers that matter: what you can comfortably bring to closing and what you want to keep in savings. Schedule a mortgage consultation, and I’ll help you compare the available options for your situation.

Schedule a mortgage consultation or start your mortgage application.

Paul Mattos

Mortgage Broker | Refine Mortgage

Carolina Home Financing

NMLS# 2339069 | Licensed in NC and SC

Call or text: 980-221-4959

Email: paulm@refinemortgage.net

Refine Mortgage Inc. | NMLS# 2417960 | Equal Housing Lender. This article provides general educational information and is not a commitment to lend, a rate quote, or an offer of specific credit terms. Down payment, closing cost, and assistance options vary by lender, loan program, borrower, and property. Approval, pricing, and program availability depend on credit, income, assets, property, appraisal, and underwriting requirements. Not all applicants will qualify.