From the RatesQ team · Sample question

How much should I have saved before buying my first home?

This educational scenario and its sample explanations are not posts from real users.

I have $35k saved. I want to buy something around $300k in a medium cost-of-living city. Is $35k enough or am I still short?

Quick Summary

  1. Cash needed for a purchase includes more than the down payment.
  2. Closing costs, prepaid expenses and reserve requirements can affect the amount needed.
  3. Keep the lender estimate separate from your own moving and household budget.

Sample explanations

From the RatesQ team

Let's run the numbers: 5% down on $300k = $15,000. Closing costs in a medium COL city might be $7,000-$10,000. That's $22-25k total. You'd have $10-13k left as reserves after closing. Most lenders want 2+ months of PITI in reserves. On a $300k home your PITI might be ~$2,200-$2,400/month. So 2 months = $4,400-$4,800. You should be fine. The question is whether you're comfortable with that much of your savings going to the purchase.

From the RatesQ team

The numbers look workable, but a few things to verify: closing costs vary by state — some states have higher transfer taxes. Also check if your area has first-time buyer assistance programs that cover down payment or closing costs, which would stretch your $35k further. One thing often overlooked: moving costs, home repairs after purchase, and any immediate needs (appliances, etc.) can eat into savings quickly. Having $35k going in with $300k purchase is feasible, but lean. If you can hold off 6-12 months and save another $10-15k, you'd feel less stretched after closing.

From the RatesQ team

Also FHA with 3.5% down would be $10,500 down instead of $15k, which frees up $4,500. Trade-off is MIP for 11+ years. Might be worth comparing both scenarios with a lender.