Bridget's Blog


How Much Money Do I Need To Buy A Home?

How Much Money Do I Need To Buy A Home?

How much money do I need to buy a home is a question I get asked a lot.   Final costs really vary depending on the type of loan you are getting, how much you are putting down on the house, how much the seller will contribute, if there are grants or community lending programs being used, if there is a lender credit.  Lots of variables.


Often people have heard they need 20% of the purchase price to put down on the house... that is not the case these days.   There are lots of programs that not only allow you to put significantly less than 20% down on the house, (possibly even 0 down!), but there are even grant or community lending products that will cover anything that you may be required to put down.  Most loan programs even allow gifts from a relative or allow the seller to contribute toward closing costs.


The part that most home buyers are not aware of is how much money will there be OUT OF POCKET? Before you get to closing there are out of pocket costs that you will need to have in your account or available.



How much do I need to buy a home



You might be surprised at how many potential buyers come to me like this.


They have accounts showing balances of less than $5 or worse, have negative balances.

So how much money do I need even before I  buy a home?


When submitting a contract you will need an Earnest Money Deposit (EMD).  This is a good faith deposit on the contract that shows the seller that you are serious about the purchase.   Usually the minimum required is $500, sometimes the required EMD will be 1% of the purchase price.  If competitive, a higher earnest money deposit may encourage a seller to choose your contract.  The EMD will be credited toward your required down payment or closing costs.  


Once there is an accepted contract between a buyer and a seller, the buyer will have a home inspection done.  In Maryland the cost for a home inspection usually ranges between $350 and $500 (and can vary by the size of the property)  This cost is paid at the time of the inspection.


Some of the additional fees that may be incurred are also usually paid at the time of the inspection or loan application:

  • pest inspection (estimated at $35- $95)
  • well and septic inspection -if needed (costs vary)
  • radon testing (costs vary)
  • Appraisal Fee-estimate at $500 (may be paid by credit card)
  • Application Fee (depends on lender)



Please be sure you talk to your lender and your realtor about the funds that are required in your area BEFORE you get to closing and not just the down payment or closing costs for the loan...don't get caught with EMPTY Pockets!


How Much Money Do I Need To Buy A Home?

Warm Regards,

Bridget McGee  Maryland Mortgage Mama  NMLS# 196068  SWBC Mortgage.   410-960-2061 EHO or


If you are considering purchasing a home in Maryland and want to be sure you are mortgage ready, my brother Tony and I will be happy to help! We help to make the mortgage process a pleasure! 

If you already own your home, we are happy to provide a no-cost mortgage review to help you to determine if refinancing may be in your best interest.  Please contact me at 410-960-2061.

Comment balloon 2 commentsBridget "Mortgage Mama" McGee • August 23 2017 02:10AM


Good information and advice, Bridget.  A lot of people don't realize they don't need 20% down. Also, a lot of people think they won't need any money at all.  That's why it is important for potential home buyers to speak with a loan originator first.  

Posted by JoAnn Moore, Home Loans in Delaware (The Mortgage Market of Delaware) over 3 years ago

Great information for potential buyers.  It's best to know what expenses will need to be paid before closing as well as how much to bring to the table.  No one likes surprises!

Posted by Melissa Jackson, Helping You Make The Right Move (Century 21 Alliance Properties) over 3 years ago