9 Things You Need to Buy a House

Buying a house is one of the biggest financial milestones in your life—especially if it’s your first one! But where do you start when the whole process feels overwhelming? What do you actually need to buy a house? How much do you really need for a down payment? And is your credit score high enough?

The truth is that you don't need a perfect financial profile to buy a home, but you do need a plan. Here are the 9 most important things that will make the homebuying process not only possible but successful:

1. Steady source of income

This is the foundation of your mortgage application. Lenders look beyond just how much money you make; they will also seek consistency in your earnings. 

Typically, you’ll be required to provide these documents when you apply for a mortgage:

• Pay stubs
• W-2 forms
• Employer verification letter
• Tax returns
• Bank statements

If you have other sources of income, such as rental income, retirement income (401(k) or IRA), or dividend income, you can use them to supplement your application.

2. Good credit score

A higher credit score signals to lenders that you are a low-risk borrower. This doesn’t just mean you’re more likely to get approved; it often means you can qualify for a lower interest rate. Over the typical 30-year life of a loan, even a slightly lower interest rate can save you tens of thousands of dollars.

So, what credit score do you need to buy a house? While 620 is a good benchmark for conventional loans, different programs have different requirements. For example, government-backed loans, such as FHA or VA loans, often have more flexible requirements and allow for lower credit scores in the 500s. 

That said, even if you qualify for a mortgage with a score of 560 through a specific lender, take a moment to reflect on whether you can improve your credit before applying for a loan to secure better terms. It will pay off for years to come.

3. Down payment

One of the most common myths is that you must save up 20% of the home price before you buy. In fact, in 2025, the typical down payment for first-time buyers was just 10%.[1] The amount you need to save for your down payment depends entirely on your budget, the loan type you choose, and what programs and loans you can qualify for.

There are also many initiatives that can help you buy with less cash upfront, such as HUD’s Good Neighbor Next Door program (designed for law enforcement officers, teachers, firefighters, and EMTs). With this program, the minimum down payment is listed as $100, instead of the standard 3.5%. 

If you’re looking for down payment assistance, you can check the list of HUD’s resources by state to see what local down payment assistance programs might be available in your area. You can also check your local state and government websites for down payment assistance programs in your area.

4. Funds for closing costs

Many first-time homebuyers focus on the down payment and forget that closing day also comes with significant expenses. Closing costs can include many different fees: appraisal and attorney fees, title searches, and taxes. Typically, they run between 2% and 5% of the loan amount, which adds up to an additional $6,000 to $15,000 in cash for a $300,000 home.

If you need assistance covering closing costs, you can negotiate with the seller for concessions. Or in some cases you can use lender credits or roll some costs into the loan balance, which will make your monthly payment higher but won’t require as much cash upfront. Another option is to look into newly constructed homes, where builders often use financial incentives to seal the deal. 

As Robert Dietz, chief economist at the National Association of Home Builders said regarding the 2026 home market, “Incentives are very elevated right now, and that’s good news for buyers . . . Builders are using their financial resources to lower buyers’ mortgage rates for the first two or three years, helping to ease monthly payment pressures. Other incentives include amenity upgrades and closing cost assistance, though there are limits to how much builders can offer. Still, it’s one of the industry’s main ways of responding to ongoing affordability challenges.”

5. Emergency fund

According to the Joint Center for Housing Studies at Harvard University, many homeowners struggle to pay for home repairs.[2] A healthy emergency fund can make home repairs much less disruptive to your finances. 

An emergency fund can also help you make your mortgage payment when life throws you curveballs. Lenders prefer to see that you have an additional three to six months of living expenses saved (often called “reserves”). This serves as a guarantee that you can keep up with your mortgage payments and provides you with much-needed peace of mind.

6. Familiarity with your real estate rights

Entering the housing market can feel intimidating, but buyers have significant protections under the law. Before shopping, make sure you understand the basics of the Fair Housing Act and how to respond if your rights are violated.

There are also strict rules and regulations that lenders must follow to ensure transparency in the provided services and costs. Knowing these basics can help you avoid being pressured into a bad deal or paying fees that were not properly disclosed.

7. Home that appraises for the right price and passes inspection

You might fall in love with the house, but not every single property can be financed by a mortgage. Before a bank finalizes your loan, they will order an appraisal to determine the home's fair market value. If the house appraises for less than the offer price, you might have to renegotiate with the seller or cover the difference in cash.

Similarly, a home inspection can protect a buyer and their investment. A licensed home inspector will go through the property to check the foundation, roof, and all major systems. If they find any major issues, you can ask the seller to lower the price, make repairs, or even walk away from the deal. 

If you want to avoid these maintenance pitfalls entirely, you might consider new construction. As Dietz points out, new builds often offer “lower maintenance costs and newer systems” that can save you from major issues found in new properties.

8. Experienced real estate agent

A good real estate agent is a must for first-time buyers. In fact, according to the National Association of Realtors Profile of Home Buyers and Sellers, 88% of all buyers over the past year purchased a home with professional help. Real estate agents are expert negotiators who know the local market and represent your interests, not the seller’s. 

They handle many responsibilities, from finding properties that match your budget to putting together a winning offer and guiding you every step of the way. The NAR study also cited that three out of four first-time buyers credit their agent with helping them understand the process.

9. Reliable mortgage lender

Your lender is your financial partner in the process. They are the ones who will examine your application, explain your loan options, and secure the funding for your house.

Finding a lender who openly communicates and is willing to answer your questions is as important as finding the lowest rate. So, take some time and compare a few different lenders. Pay attention to the loan types they offer, customer service, and perks (such as down payment assistance). Obtain a pre-approval letter from a couple of your top options to test their service in action and compare the terms and costs.

Next steps: Meet with a loan officer to see if you’re ready to buy a house

Meeting with a mortgage lender is a perfect first step to take towards buying your dream home. A lender can look at your unique situation, such as your income, debts, and savings, and tell you exactly where you stand.

Whether you are ready to apply for a pre-approval today or just want to map out a two-year savings plan, meeting with a Best Interest Financial advisor can give you clarity and an idea of what comes next. Get a custom quote from Best Interest Financial in 60 seconds today.

FAQ about buying a house