The short answer: probably less than you think for a down payment, but more than just the down payment.
A common mistake is to focus only on the purchase price or the amount a lender says you can borrow. The better question is: How much cash will I need up front, and what monthly payment will feel comfortable once I own the home?
For buyers in Pinellas County and the greater Tampa Bay area, a realistic plan should include five things:
- Your down payment
- Closing costs and prepaid expenses
- Earnest money deposit
- Inspection and other upfront costs
- A sensible cash reserve after closing
You may not need 20% down
Twenty percent down is still a useful benchmark because it can reduce your loan amount and may eliminate private mortgage insurance. But it is not the minimum required to buy.
Depending on the loan program and your qualifications, some conventional loans may allow a down payment as low as 3%. FHA financing may allow as little as 3.5% down for eligible buyers. Your lender can show you the options that fit your income, credit, property type, and overall goals. The Consumer Financial Protection Bureau notes that many buyers can purchase with less than 20% down. One of the key things to look at when considering a loan downpayment, is it better for your goals to get a smaller loan or get a rate buydown and have a bigger loan but a lower interest rate. Over time you’ll likely pay more with the rate buydown but it may be better for you depending on circumstances.
The key is not to put every available dollar into the down payment simply to reach a round number. Buying a home with no remaining cushion can create unnecessary pressure the moment you need to move, furnish a room, replace an appliance, or make a repair.
How Much are Closing Costs?
In addition to the down payment, buyers should plan for closing costs. These are the costs of finalizing the loan and transferring ownership. They can include lender charges, appraisal, title and settlement services, recording fees, prepaid property taxes, homeowners insurance, and initial escrow deposits. Ask your lender for a full schedule of their costs, there are a lot of fees that come with obtaining a loan from origination and underwriting fees to appraisal and credit reporting fees. Loan related fees will likely be one of the biggest loan expenses.
As a broad planning guide, the Consumer Financial Protection Bureau estimates closing costs at approximately 2% to 5% of the purchase price, excluding the down payment. Your actual figure will depend on the loan, lender, purchase price, insurance costs, and the specific property. Read the CFPB’s closing-cost guidance.
For a $400,000 home, the planning picture could look like this:
| Down payment | Down payment amount | Estimated closing costs | Approximate cash needed to buy* |
|---|---|---|---|
| 3% | $12,000 | $8,000–$20,000 | $20,000–$32,000 |
| 10% | $40,000 | $8,000–$20,000 | $48,000–$60,000 |
| 20% | $80,000 | $8,000–$20,000 | $88,000–$100,000 |
*This is a planning example, not a loan quote. It does not include a separate post closing reserve, moving expenses, furnishings, or repairs.
What about out of pocket costs before closing?
Some expenses arise before closing rather than on closing day. These may include:
- Earnest money deposit after your offer is accepted
- Home inspection
- Additional inspections, if needed
- Appraisal, depending on the loan and lender
- Homeowners and flood insurance typically need to be prepaid at close
- Condo or HOA fees, typically 1 – 2 months in advance
- Condo or HOA application fees and sometimes tansfer fees
- Moving costs and immediate repairs or improvements
- You’ll get a credit for property taxes for the time the seller has owned the property that year, but you will owe the full year when the bill comes in November.
Your earnest money is generally credited toward your purchase at closing, so it is not necessarily an additional cost. However, it is money you need available early in the process.
How much is my payment after close?
A lender’s preapproval tells you what you may be able to borrow. It does not automatically tell you what payment will feel comfortable in your real life.
Before choosing a price range, look at the full monthly cost:
- Principal and interest
- Property taxes
- Homeowners insurance
- Flood insurance, where applicable
- Mortgage insurance, if applicable
- HOA or condo fees
- CDD fees, where applicable
- Utilities, maintenance, and repairs
This is especially important when buying a condo. The monthly condo fee, insurance arrangement, reserve funding, and the possibility of future assessments can materially change the real cost of ownership. A lower purchase price does not always mean a lower overall monthly cost.
How do I set your budget?
Start with the cash you have available, then work backward:
- Decide how much you want to keep in reserve after closing.
- Set aside money for moving and the first few months of ownership.
- Estimate closing costs.
- Use what remains to consider your down payment options.
- Speak with a lender about the monthly payment at several price points, not only the maximum loan amount.
A good lender should be able to show you estimated payments and cash to close figures for different purchase prices and down payment options. Once you are under contract, the Loan Estimate and later Closing Disclosure will show the more specific numbers for your transaction. The CFPB explains how estimated cash to close is calculated.
The bottom line
You do not need to have everything figured out before beginning the conversation. The right amount of money to bring to a home purchase depends on your loan options, the type of home, insurance costs, and the amount of financial breathing room you want to retain afterward.
The goal is not to stretch to the highest number possible. It is to buy a home that works for your life, and still feel comfortable once you have the keys.
If you are considering a move in St Petersburg, Pinellas County or Tampa Bay, I can help you evaluate the property side questions, including condo fees, building considerations, insurance, and the total ownership picture. A lender can help define what you qualify for; together, we can help make sure the home and payment make sense for you.
Read More: What is the home buying process →
Continue Planning Your Move
Explore the Buying a Home section of The Property Briefing for practical guidance on financing, inspections, making offers, condos, and the decisions that come before closing.
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