The short version: get pre-approved, know your all-in monthly budget, line up your cash for the down payment and closing costs, then search with a plan. California's CalHFA offers down payment help for eligible first-time buyers.
1. Know what you can afford
Example price ranges using 36% of gross income for housing, 20% down, a 6.5% example rate, 1.1% property tax and $200 a month for insurance:
| Household income | Approx. price | Monthly housing budget | Loan type |
|---|---|---|---|
| $100,000 | $469,000 | $3,000 | Conforming |
| $150,000 | $720,000 | $4,500 | Conforming |
| $200,000 | $971,000 | $6,000 | Conforming |
| $250,000 | $1,222,000 | $7,500 | Conforming |
| $300,000 | $1,473,000 | $9,000 | Conforming |
| $400,000 | $1,975,000 | $12,000 | Jumbo |
Illustration only. Your rate, debts, down payment and HOA change these numbers. Try the affordability calculator with your own figures.
2. Get pre-approved
A lender checks your credit, income and assets and tells you what you can borrow. Sellers expect a pre-approval letter with your offer.
3. Line up your cash
- Down payment (as little as 3% to 3.5% with some loans)
- Closing costs, often about 2% to 3% of the price
- Earnest money deposit, commonly around 3%, credited at closing
- Inspections, moving costs and a cushion for the first months
4. Look into assistance
CalHFA programs such as MyHome Assistance and Dream For All can help eligible first-time buyers with the down payment. They have income limits and require an approved lender; Dream For All opens in limited rounds.
5. Search, offer, close
Set up your search, tour homes, then write an offer with the right contingencies. Escrow commonly takes about 30 days. See how buying with Eunice works.
In their words
"We were first time home buyers and felt naïve and intimidated by the process… Within a week of meeting Eunice, we put down our first offer on our dream home (which ended up getting 19 offers), and to our utter disbelief, we won."Zillow review, first-time buyers in San Dimas, 2021