Relocation and First-Time Buyers
How much money do I need to buy my first home?
By Steve Lockhart
The short answer
The number people think of first is the down payment, and it is usually smaller than they fear. Conventional loans commonly allow 3 percent down.
Full answer
The number people think of first is the down payment, and it is usually smaller than they fear. Conventional loans commonly allow 3 percent down. FHA often allows 3.5 percent. Eligible VA buyers can close with no down payment at all. Nevada also has down payment assistance programs for buyers who qualify, which can cover part of the cash need.
The second bucket is closing costs, the one-time fees paid at closing: the lender's fees, the appraisal, the title and escrow charges, the insurance escrow, and related costs. In Las Vegas these typically run a few percent of the purchase price. On a home priced in the hundreds of thousands, that is real money, planned separately from the down payment.
The third bucket is the one that surprises people: the money you still need after closing. Moving costs money, the first year brings furniture and small projects, and an unexpected repair becomes a crisis if your savings are at zero. Buyers who put every dollar into the purchase start homeownership one emergency away from trouble.
Add them up backward. Start with the savings you can genuinely put toward the purchase, subtract what you need to keep as a cushion, and work out what down payment and closing combination the remainder supports. That is the honest starting point, and it usually changes what gets shopped for.
Two buyers with the same income and different savings will make very different first purchases, and both can be right. The goal is not to stretch into the biggest house; it is to make the first purchase a strong foundation for the next one.
Go a little deeper
Frequently asked
Questions people often follow up on
Can I really buy with 3 percent down?
Yes, many first-time buyers do. Conventional loans with 3 percent down exist, FHA allows 3.5 percent, and eligible VA buyers can finance with nothing down. A bigger down payment lowers the payment and can reduce mortgage insurance, but it is not a requirement.
What counts as closing costs in Las Vegas?
Buyer closing costs usually include lender origination fees, the appraisal, the home inspection, title and escrow fees, and prorated taxes or HOA dues. The exact list shows up on your loan estimate, which the lender gives you in writing early.
Do I need 20 percent down to avoid mortgage insurance?
No. The 20 percent figure is about avoiding private mortgage insurance on a conventional loan, but many buyers put down less and carry a modest premium instead. Some programs handle it differently. Run the real monthly numbers before assuming.
The Lockhart Method
The Lockhart Method
Your Home | My Strategy | Proven Results
My strategy: build the three-bucket plan on paper before the search, down payment, closing, reserves, and keep the reserves sacred. A first home should strengthen your finances, not empty them.
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