How Much Is the Down Payment for a $400,000 House?

Table Of Content

• What income do I need to afford a $400K house?
• This is how much money you need to earn annually to comfortably buy a $400,000 home in 2024
• Big Homes, Little Prices (You CAN Buy A Lot For A Little)
• What factors determine how much you can afford?
• Fort Wayne, Indiana
• Irvine, California
• Faster, easier mortgage lending

However, the minimum down payment for a $400K house would be only $2,000 more for those with a score of 580 instead of 620. From your lender’s point of view, a down payment is about your having skin in the game. The bigger your down payment, the more likely you are to keep up your monthly mortgage payments and fight to keep your home if times get tough. Of course, that means the lender’s risk of making a loss on your loan is smaller than it is with less-invested borrowers.

What income do I need to afford a $400K house?

The average price per square foot in the Golden City is $996 for all homes and $1,019 for single-family homes. Lenders may also offer their own financial assistance or other low-down-payment loans, such as conventional loans with 3% down and FHA loans with 3.5% down. The year-over-year unemployment rate has increased in Fort Wayne, although the labor market has been more resilient than the national average. Most people in this city work in transportation, utilities, manufacturing, and education and health services.

This is how much money you need to earn annually to comfortably buy a $400,000 home in 2024

The listings on Realtor.com in this price range looked well-kept but could use some updates. In the center of town, you’ll find turn-of-the-century brownstones—and one or two of the one-bedroom listings come with a price tag under $300,000. Bankrate’s home-affordability calculator can help you figure out what salary is needed to afford a $400,000 home. Based on these numbers, your monthly mortgage payment would be around $2,470. Over the past year, the average price per square foot for single-family residential homes in Fremont was $952. The estimated size of a $400,000 home is 420 square feet—barely larger than in San Francisco.

'You screwed up': Ohio man wants to retrieve $400K gift his late wife left their adult kids because it's 'the wrong lesson ... - Yahoo Finance

'You screwed up': Ohio man wants to retrieve $400K gift his late wife left their adult kids because it's 'the wrong lesson ....

Posted: Sat, 02 Mar 2024 08:00:00 GMT [source]

Big Homes, Little Prices (You CAN Buy A Lot For A Little)

And you’ll have to sell the home or refinance the mortgage to escape it before you finish paying down this loan type. “It’s important to work with an agent and lender in your local market who can provide clarity on closing costs specific to your market,” McDaniels says. “If you can’t pay for the closing costs, you won’t be able to move forward with purchasing the property." For most buyers, working with a knowledgeable local real estate agent is invaluable.

These loans provide the money to buy a home along with funds to rehabilitate the property. Some of Abilene’s best features include above-average schools, plenty of parks, and are a three- to four-hour drive to Dallas and Austin, respectively. The employment situation here needs work, according to Niche, but Abilene generally scores well in diversity, weather and commute lengths. The Midwest also scored highest on NAR’s Affordability Index, which measures whether a typical family earns enough income to qualify for a mortgage in that region. Just go to our home page and scroll down to our suite of mortgage tools.

The median home value in Fremont, California, is roughly $1.2 million, according to 2021 Census Bureau data. The share of first-time homebuyers dipped to 27% in September, down from 29% in August, according to the Realtors Confidence Index survey. Three more California metros — Anaheim, Oakland and San Diego — round out the top five, requiring interested buyers to earn between $240,000 and $300,000 annually. To put those figures into perspective, the median U.S. household income was $75,000 in 2022, according to the report. Residents can easily drive to Montreal, New York City and Boston within 3.5 hours, or quickly escape to the nearby Finger Lakes wine region and the Berkshires of Massachusetts.

Fort Wayne, Indiana

Conventional loans typically require a down payment, so they are not considered “no down payment” loans. A $400K home with 3 percent down at a 7% interest rate for 30 years would cost approximately $2,600 per month. Keep in mind that this is an estimate, and your actual monthly payment may vary depending on your specific loan terms and any additional costs such as property taxes and insurance. Many first-time buyers have little trouble affording their monthly mortgage payments, which can sometimes be less than what they are paying in rent.

Irvine, California

We sought to find how big of a home you could purchase with $400,000 in the 100 largest U.S. cities. We considered the average price per square foot for homes sold from April 2022 through March 2023 using data from Redfin. Perhaps surprisingly, Los Angeles slightly outperforms Irvine regarding home affordability. However, the average price per square foot for single-family homes in Los Angeles is slightly lower, at $665 (compared to $721).

Fixer-uppers—no matter how old they are—may also sell for a lower price, but they require time and money after the sale. If you choose to buy a fixer-upper and complete the home improvement projects yourself (rather than hiring a professional), the savings may be significant. Buyers may find themselves competing against veteran homeowners who can make cash offers.

The median income in these cities is high, but so are real estate prices. Higher interest rates have increased the cost to borrow, so buyers will need to show significant income to get a mortgage. According to one rule of thumb, you should spend no more than 28% of your pretax income on your housing payment and 36% on all your debts combined.

Kim Porter began her career as a writer and an editor focusing on personal finance in 2010. Since then, her work has been published everywhere from Forbes Advisor to U.S. News & World Report, Fortune, NextAdvisor, Credit Karma, Bankrate, and more.

However, it’s highly unlikely mortgage rates will drop to 2021 levels, according to Derek Amos, senior mortgage loan originator with Mutual of Omaha Mortgage. Don’t stop monitoring the factors listed above once you go into contract. It can take weeks or even months before your purchase closes, and you don’t want anything to change your finances until the deal is completely done. For example, don’t apply for new credit cards or make purchases that require financing, like a car, because those can affect your credit score. And if possible, don’t switch jobs or make any big life changes, such as getting married, either. In addition, keep in mind that a $400,000 home can look vastly different from one location to another.

We investigated how much home $400,000 can buy you in the 100 largest U.S. cities. We estimated the size of a $400,000 house using data on the average price per square foot for home sales in these cities from April 2022 through March 2023. We also discuss the median home value and percentage of single-family homes using 2021 data from the Census Bureau. The interest rate on your mortgage will impact your monthly payment, so get an idea of general current mortgage rates while you’re setting a budget. Advertised rates may only apply to extremely qualified borrowers, so it’s a good idea to get a rate quote from a lender.