There are a lot of myths about buying a house: that you need at least a 20% down payment, perfect credit (or close to it), and a specific income level.
But the truth is, you don’t need a particular down payment amount, salary, or a credit score over 700 to become a homeowner. What you do need is insight into the process, preparation, and a game plan.
To help you move ahead with your home-owning dreams, read this guide. You’ll learn answers to questions such as, “what are the requirements to buy a house?” and “how much of a down payment do you need to buy a house?” We’ll also cover what credit score you need to buy a house and even what documents are needed to buy a home.
Table of Contents
Key Points
• Understanding credit score requirements is crucial; a score of 620 may be needed for some conventional loans, while government-backed loans might accept lower scores.
• Debt-to-income ratio significantly influences loan eligibility, ideally being 36% or less.
• Proof of income through documents like W-2s and tax returns is essential for mortgage preapproval.
• Savings for down payments and closing costs are necessary, with first-time buyers averaging a 10% down payment.
• Gathering necessary documentation early can facilitate the mortgage application process.
8 Requirements to Buy a House
Here’s the scoop on the items you need to line up in order to purchase a home. Consider this your “what I need to buy a house” checklist that will put you on track to achieve your dream.
1. Credit
Your credit score ranks high on the list of what is needed to buy a house. It’s one of the primary factors lenders will consider when reviewing your mortgage application and deciding if you can qualify for a mortgage. It helps a lender evaluate how well you have managed debt and made timely payments in the past.
Being aware of your current score may also help you understand what loan programs you may be eligible for.
Credit Score Requirements by Loan Type
What credit score is needed to buy a house, given the possible range of scores from 300 to 850? The easiest way to understand what is needed is to consider the need based on your loan type.
• Conventional loan For a loan not backed by the government, you’ll likely need a credit score of at least 620, though some lenders will accept 600. However, most homebuyers have a score that’s higher than that, and if you have a brag-worthy credit score (say, 740 or above), you may qualify for better loan terms, such as the lowest available interest rate.
• FHA loan For a loan backed by the Federal Housing Administration, 580 is the minimum score to qualify for the 3.5% down payment advantage. But what if your score is not so lofty? Don’t fret — you’re not alone. In fact, more than one in 10 buyers in the home market are concerned about an insufficient credit score, according to an April 2024 SoFi survey of 500 people. In the case of FHA loans, applicants with a score as low as 500 can still qualify but must put down 10%.
• VA loan These loans, backed by the U.S. Department of Veterans Affairs, are for eligible military members, reserve members, and surviving spouses. The VA doesn’t set a minimum credit score for its loans, but lenders who make VA loans may set their own criteria. SoFi, for example, requires a minimum score of 600 for a VA loan.
• USDA loan These income-restricted loans for rural properties, backed by the U.S. Department of Agriculture, typically require a score of 640 or better. (SoFi does not offer USDA loans, though it does offer FHA and VA loans).
The government offers periodic free credit reports so consumers can review their credit history, but the reports do not give a credit score. However, seeing your credit report can allow you to recognize and remedy any errors or delinquent accounts.
You can monitor your credit score with a paid service as well. You may find these third-party services are available for free from some banks and credit card issuers, and use one at no cost with this money tracker.
2. Debt-to-Income (DTI) Ratio
Your debt-to-income (DTI) ratio is one of the key requirements to buy a house. Your DTI number matters when determining the mortgage amount and the type of loan program you qualify for.
The DTI ratio equates to your monthly minimum debt payments divided by your gross monthly income. To find it, you would add up your monthly payments towards an existing mortgage (or rent) and related expenses (say, property taxes and insurance), plus any credit card debt and student, car, or other loans. Then you would divide that by your monthly salary, before taxes and other deductions are taken out.
Mortgage lenders usually like to see a DTI ratio of 36% or less for conventional loans. However, some will accept up to 45% and possibly even 50%. There is some flexibility out there, but it may require a bit of shopping around if you have a relatively high DTI.
3. Proof of Income
Even if you have a stellar credit score, for the majority of loan programs, you still have to prove your income to the lender to gain loan approval. This helps the lender verify that you have the means to pay the mortgage back.
For the mortgage preapproval process or the final approval process, you’ll typically need to submit W-2s, your two most recent pay stubs, and your most recent federal tax return for the lender to verify your income. (Self-employed applicants will need to have two years of records on their list of what is needed to buy a house, and may also be asked to submit a year-to-date profit and loss statement.)
If you are currently unemployed or have changed jobs recently, this may create a hurdle when seeking a mortgage. You might want to delay your home-buying plans until you have a more consistent employment record, or search for a lender that is less rigid in terms of this qualification.
4. Savings for a Down Payment and Closing Costs
As you think about how much house you can afford and what is required to buy a house where your savings account is concerned, you will likely want to run some numbers. You might start with a home affordability calculator to help you know your target range.
Now, about that down payment: Perhaps you’ve cobbled together a few thousand, but wonder about what is the average down payment on a house. Many people have heard you need at least 20% down, which can be an intimidatingly high number.
You can breathe a bit easier: The average down payment for a first-time homebuyer is actually 10%, according to the National Association of Realtors® (NAR). The down payment on a $300K house, for example, would be $30,000. That’s nothing to sneeze at, of course. But fully 29% of would-be buyers in SoFi’s survey were planning to put down 10% or less — and 7% were exploring zero-down-payment financing options.
The more you can put down, the more likely it is that you could get a lower interest rate. In most cases, you’ll need a 20% down payment to avoid private mortgage insurance or a mortgage insurance premium.
Here’s a glimpse of loan types and down payments of each:
• Conventional loan. This is the most common type of home mortgage loan and typically has a minimum down payment requirement of 3% for qualified buyers. The exception? If the loan you need exceeds the conforming loan limit for your area and you need a jumbo loan, you will likely need to put down at least 10%.
• FHA loan. This loan, among a few kinds of government home loans, requires as little as 3.5% down for those who qualify.
• VA loan. If you qualify for a VA loan, you can usually buy a home with no money down.
• USDA loan. There is no down payment required.
Down Payment Assistance Programs
If you are a first-time homebuyer, you can also look into down payment assistance programs. (In the SoFi survey, among people who said having a down payment was their top homebuying concern, 49% had not explored these programs.) An online search for these first-time homebuyer programs and loans from the Department of Housing and Urban Development (HUD), state and local housing authorities, nonprofits, and other organizations can help you reach your homeownership aspirations.
The other aspect of buying a house that may require cash: closing costs. These typically add up to between 3% and 6% of your loan. They include items like bank processing costs, title search, appraisal costs, and more. It’s worth noting that some lenders may offer credits toward closing costs; that can be something to keep in mind when you are searching for a lender.
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5. Documentation
There are a couple more answers to “What do I need to buy a house?” When preparing to buy a home, you will likely need documents — a lot of documents, in fact. Assembling a file of what’s required can be an important step in getting organized. Here is some paperwork you may want to gather as you begin thinking about working with a mortgage lender:
• Recent tax returns and W-2 forms as well as proof of other income
• A letter from your employer verifying your employment
• For those who are self-employed, a business tax return and P&L statement
• Recent bank account, brokerage account, and retirement account statements
• Student loan, car loan, and credit card statements, to show how much debt you have
• Titles to your assets, such as a current home or your car
• A gift letter, if appropriate (a statement that, say, a family member gave you funds toward your down payment)
• Photo ID
Yes, it can feel like a lot, but starting sooner rather than later and chipping away at the list can make it easier.
6. Preapproved Mortgage
Before you go home shopping, it can be wise to get a mortgage preapproval letter from one or more lenders. You share certain financial information, and the lender says that you likely qualify for a loan of a certain amount.
While not a guarantee of mortgage approval, this will give you insight into what kind of loan you qualify for. It can also show homeowners that you are a serious shopper who is ready to buy.
Recommended: Mortgage Preapproval vs. Prequalification
7. Mortgage Loan
When you find a property you love and work your way to an accepted offer and contract, you will probably be ready to apply for your mortgage. You will likely have to make decisions about the term of the mortgage (30 years is common, but shorter terms with higher monthly payments are possible, too), the rate (both the percent you’ll pay and whether you go with a fixed or adjustable rate), and other details.
When you submit your application, you will provide documentation of your financial qualifications. You will likely work your way through questions as your file goes through underwriting and you move toward your final approval and closing date. Getting a mortgage isn’t a slam dunk 100% of the time, and in fact in SoFi’s survey of home-shoppers, 11% of would-be homeowners said difficulty securing a mortgage was the biggest challenge they were facing. Here again, going through the mortgage preapproval process can help head problems off early on.
8. Real Estate Agent (Probably)
The vast majority of buyers use the services of a real estate agent or broker, according to NAR. In 2025, 88% of homebuyers worked with one.
You can go it alone, but finding a real estate agent who is experienced and knowledgeable can be key to, well, getting you a new set of house keys.
Agents have access to the multiple listing service, which is a comprehensive list of homes for sale by a real estate agent or broker in your desired location.
A buyer’s agent can help you:
• Build your wishlist and hunt for homes that fit your needs
• Check out listings in person
• Write offers and counteroffers, including putting an offer on a contingent house
• Negotiate with the seller
• Navigate the complexities of the purchase contract.
Using a real estate agent might also relieve some of the stress that comes with purchasing a home, especially when buying in a hot house market.
Recommended: First-Time Homebuyer Guide
Steps to Buy a House
Once you’ve lined up your documents and checked all your numbers (credit score, DTI ratio, down payment amount), you may wonder where to begin. Home-buying typically follows a pretty predictable process. Here it is, boiled down for your reference:
1. Decide if you’re financially ready
2. Set a purchase budget
3. Choose a loan type
4. Compare mortgage lenders
5. Get preapproved for a home loan
6. Find a real estate agent
7. Locate a home to purchase
8. Make an offer
9. Get a home inspection
10. Obtain a home appraisal
11. Close on your new home
Dream Home Quiz
The Takeaway
What do you need to buy a house or condo? First, you’ll want to be on pretty solid financial footing, typically with a good credit score, income history, and DTI, as well as some money saved toward a down payment and closing costs. You may also want to have a good agent and the right documentation in your corner.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
FAQ
What are the basic needs to buy a house?
To buy a house, you will likely need documentation of your finances, a reasonable credit score and debt-to-income ratio, a mortgage preapproval, and probably funds for a down payment and closing costs, as well as a real estate agent to help you manage the process. And you’ll need to find a house you can afford: A SoFi survey of 500 would-be homeowners showed that for 42%, finding a home within their price range was the largest challenge they were facing.
How much money should you have before buying a house?
Lenders will likely want to see that you are financially stable and can afford the costs associated with owning a home. In terms of a down payment, the average for first-time buyers is 10% of the home’s price, but there are ways to buy a home with less or perhaps with no money down. A down payment of 20% or more will allow you to avoid paying for private mortgage insurance (PMI).
What credit score is good to buy a house?
The credit score needed to buy a house will vary, with 620 being the usual minimum for a conventional loan, though most buyers have a score of 650 or higher (and some lenders will accept a score of 600). Those with scores of 740 or higher will usually get the best loan terms. There are also programs to help those people with credit scores in the 500s become homeowners.
Can I buy a house with no down payment?
It is possible to buy a house with no down payment by using a VA loan or a USDA loan. You might also explore down payment assistance programs that will grant or loan you money for a down payment if you can’t come up with the funds.
Can I buy a house with bad credit?
It is possible to purchase a house when you have fair or even poor credit, particularly if you apply for a FHA loan. These loans are open to people with credit scores as low as 500 as long as they are able to make a 10% down payment. Saving up a significant down payment, paying down other debts (to lower your debt-to-income ratio, another factor lenders look at), and shopping for a home that is well within your budget can all help you qualify for financing in challenging circumstances.
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*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
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¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
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