A Financial Guide for First-Time Homebuyers

Buying your first home is an exciting milestone, but it can also feel overwhelming without a clear understanding of the financial steps involved. From setting a budget to choosing a mortgage, preparation is key. This financial guide for first-time homebuyers walks through common questions and considerations to help you move forward with confidence.

Teams like those at HHHunt Homes work with experienced lender partners to help first-time buyers understand the process and make informed decisions at every stage.

How do I figure out my budget?

Establishing a realistic budget is the foundation of the homebuying process. Your budget helps define your buying power and ensures you are making decisions that support both your current needs and future goals.

When determining your budget, consider:

• Net monthly income after taxes and deductions
• Ongoing expenses such as utilities, insurance, groceries, and debt
• Savings goals, emergency funds, and long-term plans

Online budgeting tools and conversations with a lender can help you better understand your financial position before moving forward.

What can I afford?

Affordability involves more than just a mortgage payment. It also includes how comfortably a new housing cost fits into your lifestyle.

Ask yourself:

• Can you continue saving after your housing payment changes?
• Does the payment allow flexibility for future goals?
• Are you prioritizing long-term stability over short-term upgrades?

Speaking with a loan officer or financial professional can help clarify what makes sense for your situation before you begin shopping for a home. To get started you can use our mortgage calculator or visit our preferred lenders pages.

How do I know if I am ready to buy a home?

Readiness for homeownership includes both personal and financial factors. Taking time to evaluate your situation can help you decide whether now is the right time to buy.

Consider the following questions:

• Is your rent increasing or becoming less predictable?
• Is your credit score in a healthy range?
• Is your debt manageable?
• Do you have funds available for a down payment if required?
• Have you set aside money for maintenance and unexpected costs?
• Is your lifestyle stable enough to support homeownership?
• Do you have a general idea of what type of home you want?

If you can answer yes to most of these questions, pre-approval may be a helpful next step.

How much should I put down?

A down payment can be one of the biggest upfront costs for first-time buyers. While 20 percent is often discussed, it is not required for every loan program. Many options exist with lower down payment requirements, and some buyers may qualify for grant or assistance programs.

A loan officer can help explain your options and identify what works best for your financial goals.

What should I know about closing costs?

Closing costs typically range from 3 percent to 6 percent of the home’s purchase price*. These costs may include:

• Appraisal fees
• Title insurance
• Legal and administrative fees

In some cases, lender credits may help offset certain costs. Understanding these expenses early can prevent surprises later in the process.

What financing options are available?

Financing options vary based on your financial profile and goals. Common options include conventional loans, FHA loans, and other programs designed to support first-time buyers.

Working with a lender allows you to compare:

• Interest rates
• Loan terms
• Eligibility requirements
• This helps ensure your mortgage aligns with your long-term plans.

Is my credit good enough to buy a home?

Your credit score plays an important role in determining loan terms and interest rates. Reviewing your credit report early gives you time to address issues and improve your score if needed.

A mortgage professional can help you understand what you qualify for and what payment range feels comfortable.

Can I buy a home with little or no money down?

Some programs allow buyers to purchase a home with little or no money down. These options often include specific eligibility requirements and may be available through VA loans, USDA loans or down payment assistance programs.

• A mortgage professional can help determine whether these programs are a fit for your situation.
• Should I choose a 15-year or 30-year mortgage?
• Choosing the right mortgage term depends on your priorities.
• A 15-year mortgage typically has higher monthly payments but lower total interest
• A 30-year mortgage often offers lower monthly payments with higher total interest over time

Reviewing your budget and long-term goals can help guide this decision.

What is the difference between mortgage pre-qualification and pre-approval?

Pre-qualification provides an estimate of what you may be able to afford based on self-reported information. Pre-approval involves a more detailed review of income, assets, and credit.

Pre-approval often strengthens your position when making an offer and provides a clearer picture of your buying power.

Why should I buy a home?

• Homeownership offers several long-term benefits, including:
• Increased stability and comfort
• The opportunity to build equity over time
• Potential tax advantages related to mortgage interest and property taxes
• Long-term wealth building compared to rising rental costs

When is a good time to buy a home?

The right time to buy depends on personal goals, financial readiness and market conditions. While interest rates and prices fluctuate, thoughtful planning helps buyers decide when homeownership aligns with their financial future.

The good news? When you are ready to make the decision of it you have questions, our online sales advisors are just a click away. Contact them today or spend some time checking out everything we have to offer!

*Real estate market conditions, including down payment requirements, interest rates, and monthly payments, can change over time. The information in this blog is intended for general guidance and may not reflect current market conditions.