How Much Money Do You Actually Need to Buy a Home?

Are you waiting to buy because you think you need a giant pile of cash first?

Maybe you have heard that every buyer needs 20% down. Or that closing costs will surprise you like an unexpected pothole on I-285. Or perhaps you are worried that your savings account is not “homebuyer-ready.”

Here is the encouraging truth: many first-time homebuyers in Georgia need less cash than they think.

The exact amount depends on your purchase price, loan program, credit profile, closing costs, earnest money, inspection, and available assistance. But with a clear plan, homeownership may be closer than it feels.

Quick answer: How much cash should you plan to have?

For a $350,000 Atlanta-area starter home, a reasonable planning range is:

• Conventional loan with 3% down: Approximately $21,000–$28,000 available before assistance
• FHA loan with 3.5% down: Approximately $23,000–$30,000 available before assistance
• FHA loan with 10% down: Approximately $45,000–$50,000 available before assistance
• With qualifying down payment assistance: Your personal out-of-pocket amount could be substantially lower

These are planning estimates, not a loan quote. Your lender will calculate the final amount based on the property, loan program, taxes, insurance, prepaid items, and your approval profile.

Do you really need 20% down?

No. Twenty percent down is not a universal requirement.

A 20% down payment may help you avoid private mortgage insurance on some conventional loans. But it is only one strategy: not the price of admission.

For qualified buyers in 2026:

• FHA financing can require 3.5% down with a credit score of 580 or higher
• FHA financing may allow 10% down with a score between 500 and 579
• Certain conventional programs may allow as little as 3% down
• VA and USDA programs may offer other low- or zero-down options for eligible buyers

A 20% down payment on a $350,000 home would be $70,000. A 3.5% FHA down payment would be $12,250.

That difference is not small. It is the difference between “maybe someday” and “let’s have a serious conversation.”

What does a $350,000 starter home actually cost upfront?

Let’s break down the main pieces using a $350,000 purchase price.

1. Down payment

FHA example: 3.5% down

• Purchase price: $350,000
• Down payment: $12,250
• Estimated base loan amount before financed costs: $337,750

FHA guidelines generally use the 580-credit-score threshold for the 3.5% down payment tier. Lenders may have additional requirements, so the FHA minimum is not always the same as the lender’s minimum.

Conventional example: 3% down

• Purchase price: $350,000
• Down payment: $10,500
• Estimated loan amount before financed costs: $339,500

Conventional loans can have different requirements involving credit, income, debt-to-income ratio, property type, and mortgage insurance. A lower down payment does not automatically mean a lower monthly payment, so compare the full loan picture.

FHA example: 10% down

For a buyer whose credit score falls between 500 and 579 and who otherwise qualifies for FHA financing:

• Purchase price: $350,000
• Down payment: $35,000

That is a much bigger upfront commitment. Improving credit before applying may create more flexibility, but the right next step depends on your complete situation.

2. Closing costs

Closing costs commonly range from 2% to 5% of the loan amount. They may include lender charges, title and settlement services, recording fees, prepaid taxes, homeowners insurance, prepaid interest, and other transaction expenses.

For the $350,000 FHA example:

• Estimated loan amount: $337,750
• 2% of the loan amount: approximately $6,755
• 5% of the loan amount: approximately $16,888

That is a broad range. Many buyers may land somewhere in the middle, but the final number can change based on the interest rate, discount points, property taxes, insurance timing, seller contributions, and lender credits.

Do not plan only for the down payment. The down payment is the headline number. Closing costs are the supporting cast that still needs a budget.

You can review Peachtree Battle Realty’s guide to making sure you have the funds needed for closing.

3. Earnest money

Earnest money is a good-faith deposit submitted after your offer is accepted.

In Georgia, the amount is negotiated in the purchase contract. A common planning range is approximately 1% to 3% of the purchase price, although the amount varies by transaction.

On a $350,000 home, that could mean:

• 1%: $3,500
• 2%: $7,000
• 3%: $10,500

Here is the important part: earnest money is usually credited toward your purchase at closing if the transaction closes. It is not normally an extra cost on top of everything else.

But you need access to those funds earlier in the process. Your offer contract also controls when the deposit may be returned or at risk, so understand your contingencies and deadlines.

4. Inspection costs

A typical Atlanta-area home inspection in 2026 may cost approximately $400 to $475 for a standard home, with larger, older, or more complex properties costing more.

You may also choose additional inspections depending on the property, such as:

• Termite or wood-destroying organism inspection
• Radon testing
• Sewer scope
• Structural or specialized evaluations
• HVAC, roof, or chimney inspections

An inspection is not just another hurdle. It is a flashlight. It helps you understand the home before you commit to owning its quirks, repairs, and surprises.

5. Reserves and moving expenses

Some buyers focus so intensely on getting to the closing table that they forget the first month of homeownership.

You may need cash for:

• Utility deposits or transfers
• Moving expenses
• Immediate repairs
• Appliances or window coverings
• Homeowners association charges
• Landscaping or security improvements
• A cushion for emergencies

Your lender may also evaluate whether you have reserves, especially for certain property types, loan programs, or financial profiles. The exact amount varies.

A successful purchase should not leave you with an empty tank. Think of your reserve fund as the spare tire for your new home.

Can Georgia down payment assistance reduce the cash you need?

Yes. Eligible buyers may have access to down payment assistance through state, local, employer, nonprofit, or lender-linked programs.

The Georgia Dream Homeownership Program provides affordable mortgage financing and assistance options for eligible homebuyers. As of the program information effective July 8, 2026, the Georgia Dream program lists a maximum sales price of up to $625,000, along with income limits that vary by household size.

For buyers purchasing within the City of Atlanta, Atlanta Housing’s Down Payment Assistance Program states that eligible first-time buyers may receive up to $20,000. Certain public safety, healthcare, education, military, veteran, and Voucher Participant categories may qualify for up to $25,000.

Program rules matter. You may need to meet requirements involving:

• Income
• Purchase price
• Location
• First-time buyer status
• Primary residence occupancy
• Credit and underwriting
• Homebuyer education
• Minimum personal contribution

Never assume assistance is automatic. Programs can have limited funding, specific participating lenders, and rules that change. Confirm current eligibility before making an offer.

A realistic cash-to-close example

For a $350,000 home with FHA financing and 3.5% down:

• Down payment: $12,250
• Closing costs estimate: $6,755–$16,888
• Inspection: approximately $400–$475
• Earnest money: $3,500–$10,500 upfront, usually credited at closing
• Reserves and moving cushion: varies by household

A practical target may be to have approximately $25,000–$30,000 accessible, even though the final cash-to-close figure may be lower after earnest money credits, seller contributions, lender credits, or assistance.

With qualifying assistance, some buyers may reduce their personal contribution considerably. The right question is not simply, “Do I have 20%?”

The better question is: “What combination of loan program, assistance, seller contributions, and savings makes this purchase responsible for me?”

First-time homebuyer Georgia money checklist

Before you begin touring homes, review this list:

• Estimate your comfortable monthly payment
• Check your credit profile early
• Compare FHA and conventional options
• Calculate the minimum down payment
• Budget 2%–5% of the loan amount for closing costs
• Prepare for earnest money upfront
• Set aside approximately $400–$475 or more for inspection
• Ask about reserves and lender requirements
• Research Georgia Dream and local assistance programs
• Confirm program income, location, and purchase-price limits
• Keep a post-closing emergency cushion
• Request a written estimate before making an offer

Love Your Neighbor: Education before pressure

Buying a home should not feel like being pushed into the deep end of a pool with a calculator in your hand.

At Peachtree Battle Realty, we believe good advice starts with education, honest numbers, and a clear view of both the opportunity and the responsibility. Whether you are buying a mobile home, townhome, starter house, or forever home, you deserve a strategy built around your goals: not a one-size-fits-all sales pitch.

A home purchase can also strengthen the community around it. Through our support of Green Olive Tree Farm, we believe thriving neighborhoods need more than attractive houses. They need healthy soil, local growers, shared responsibility, and neighbors who show up for one another.

Grow food when you can. Support local farmers. When possible, choose seed-bearing varieties instead of seedless produce to help protect seed diversity.

Your first home can be a financial milestone and a community investment.

Love Your Neighbor. Be a smarter buyer. We have your back.

Ready to understand your own numbers? Contact Peachtree Battle Realty for a neighbor-to-neighbor conversation about buying in Atlanta and throughout Georgia.

Estimates in this article are for education and planning only. Loan approval, terms, rates, assistance, and cash-to-close requirements vary by borrower, property, lender, and program. Equal Housing Lender | NMLS #2413707 | NEXA Mortgage NMLS #1660690 | Georgia License 366882. Programs subject to change.

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