Minnesota First Time Home Buyer Real Estate Blog

How Much Money Will You Need For a Down Payment on a House?

Down Payment For a HouseWondering how much money you’ll need for a down payment on a house? Well, generally speaking, the higher the down payment, the lower your mortgage payment will be each month. But for many would-be home buyers out there, how much you’ll spend each month isn’t as big of an issue as how much money you’ll need upfront for the down payment.

In most instances, buyers will need to put down anywhere from 3 to 20% of the sale price, and that amount largely depends on the loan type. With a 30-year fixed-rate FHA mortgage, you’ll need a minimum of 3.5% down. Most conventional loans require a 20% down payment if you don’t want to pay for mortgage insurance, which typically costs between $30 and $70 per month for every $100,000 borrowed.

Certain federal programs, like VA Loans for example, don’t require any down payment, but you’ll need to meet various requirements in order to qualify for any government-assisted home loan program.

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How Long Does it Take to Buy a House?

How Long Does It Take To Buy a House in Minnesota Wondering how long it will take to buy a Minnesota home? Well, that all depends on quite a few factors. While we’d all like the home buying process to be quick, easy, and relatively stress-free, sometimes that just isn’t the case.

The best way to determine how long it takes to buy a home is to break down the home buying process step-by-step:

How Long Does it Take to Get Pre-Approved?


The first thing you’ll want to do is get a pre-approval letter from a lender. But what does that entail? Well, again, this all depends. But you can reasonably expect about 18 days from the start of the process until all your financials are review and a commitment letter is issued.

How Long Will a Home Search Take?


Market conditions often dictate how long it takes to find a home. Are you in a sellers market, or is inventory strong and favoring home buyers? If options are plentiful, chances are you’ll find the right home faster. But realistically, expect your home search to take a minimum of 3 weeks; and that’s in a good market and only if you’re diligent about your search.

How Long Will Closing Take?


Believe it or not, one recent study found that it takes 50 days on average to close on a property. But between inspections, property...

How Can I Rent And Save For a House?

How to save for a down paymentIt’s safe to say that most people would rather buy a home or condo instead of continuing to rent and pad a property owner’s pockets, especially right now when rent prices all over the country continue to spike. But if you’re someone who is finally looking to make the long-awaited transition from renting to owning, the pressure of buying a home probably feels greater than ever.

For example, did you know that NerdWallet recently estimated that it would take most Millenials over six years just to save up for a 6% down payment? Furthermore, statistics also show that inflation-adjusted rents have skyrocketed 64% from 1960 to 2014, while wages have only jumped 18% during that same timeframe. So with the cost of living so high for renters right now, just how are first-time home buyers supposed to save for a down payment? Well, here are just a few suggestions we’ve come up with that you may want to consider.

  • Pay down credit card debt - While this may seem like an odd suggestion right off the bat when the objective is to save money, paying higher-interest credit card rates only makes it harder to save money over the long-haul, ultimately preventing you from reaching your goal. Furthermore, paying down your debt will also improve your credit score and also your chances of securing a home loan when you’re ready to apply, so it’s...

What is a Down Payment on a Home? We Break It Down Here

Down Payment Info While it’s safe to say most of us know what a down payment is at its core, many first-time home buyers still aren’t sure what a down payment entails, especially in today’s market. So let’s break it all down and start from the top:

Why do lenders require a down payment?

Simply put, when buyers fork over a significant amount of money upfront, there’s even greater incentive to make monthly payments moving forward so that money isn’t lost in a foreclosure.

What’s the minimum down payment you can make?

Most mortgage lenders require at least a 3% down payment, and FHA loans require 3.5% down. But depending on your credit history specifically, you could be forced to make a down payment of 3, 5, 10, or even 20 percent.

The downside of a smaller down payment

Any down payment made under 20% will require you to purchase mortgage insurance. Private mortgage insurance (PMI) will be one option, and FHA insurance is another. An FHA-insured mortgage is generally the most common mortgage insurance route to take, which means you’ll pay an upfront premium along with monthly premium payments.  In addition to mortgage insurance, making a smaller down payment might also mean you’ll likely pay a higher interest rate, or perhaps even higher fees at closing.

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Buying a House For The First Time: Where to Start

Buying a Minnesota HomeBuying a home for the first time sounds like a great idea, until you dive deeper into the process and learn more about the ins and outs of what it all entails. It’s hard to argue that buying your first home seems like a daunting task on the surface, but just like riding a bike, driving a car, or the countless other things you’ve had to learn or do for the very first time, we promise you’ll survive and be better for it once you sign on the dotted line.

But to make life a little bit easier for you as you begin your first-time home buying journey, we’ve devised a checklist of sorts for you to follow along the way:

Review your financial situation thoroughly

First things first—figure out if you’re even in a position to buy before doing anything else. How much credit card debt do you have? Do you have a savings account with at least 3 months of living expenses built up? How much money do you have for a down payment? Are you also able to handle closing costs and other additional expenses related to buying a home?

Meet with a lender before searching homes

Meeting with a lender to determine how much you can afford certainly makes sense, but it’s also important to get fully pre-approved before looking for a home or making an offer. Most home sellers won’t even entertain an offer without a pre-approval,...