What to Save for When Buying a Home in San Marcos, CA

1. Down Payment

Your down payment is likely at the top of your list, but how much do you really need? Many believe you must put down 20% of the purchase price, but that’s not always the case. Depending on your loan type or lender requirements, some home loans allow for as little as 3.5% or even 0% down.

As The Mortgage Reports explains:
"The amount you need to put down will depend on a variety of factors, including the loan type and your financial goals. If you don’t have a large down payment saved up, don’t worry—there are plenty of options available . . ."

Working with a trusted lender can help you understand your options, including down payment assistance programs. By planning ahead, you’ll be better equipped to navigate this step confidently.

2. Closing Costs

Budgeting for closing costs is another essential part of your plan. These costs typically range from 2% to 5% of the total loan amount and cover fees for appraisals, title insurance, and loan processing.

As Bankrate explains:
"Mortgage closing costs are the fees associated with buying a home that you must pay on closing day."

Your lender can provide a breakdown of these fees and help you estimate how much you’ll need. Additionally, be prepared to budget for your real estate agent’s professional service fee, especially if the seller does not cover it. Your agent will review these details with you well in advance, so you’re never caught off guard.

3. Earnest Money Deposit (EMD)

An earnest money deposit is another cost to consider. Typically 1% to 2% of the home’s purchase price, this deposit shows the seller you’re serious about buying their home.

The good news? It’s not an extra cost. The earnest money deposit is applied toward your closing costs and down payment. Realtor.com explains:
"It tells the real estate seller you’re in earnest as a buyer . . . Assuming that all goes well, the earnest money funds go toward the down payment and closing costs."

While not always required, an earnest money deposit can strengthen your offer. Your real estate advisor will guide you on whether this is necessary based on the competitive landscape in San Marcos.

Bottom Line

The key to a successful homebuying experience is understanding the costs you’ll encounter. By working with an expert agent and a trusted lender, you’ll be well-prepared and confident every step of the way.

Ready to explore your options in San Marcos? Let’s connect and create a personalized plan to make your dream of homeownership a reality.