Buying your first home in 2026 is challenging but absolutely achievable. With rates at 6.46%, the key is knowing what you can afford, which loan programmes apply, and how to minimise upfront costs with down payment assistance.
How much house can you afford?
Use the 28/36 rule: housing costs should not exceed 28% of gross monthly income, and total debt stays under 36%.
| Annual income | Max monthly payment | Affordable home price |
|---|---|---|
| $60,000 | $1,400 | ~$185,000 |
| $80,000 | $1,867 | ~$250,000 |
| $100,000 | $2,333 | ~$320,000 |
| $130,000 | $3,033 | ~$420,000 |
Down payment options in 2026
| Loan type | Min. down | Min. credit score | PMI? |
|---|---|---|---|
| Conventional | 3% | 620 | Yes, until 20% equity |
| FHA | 3.5% | 580 | Yes, life of loan |
| VA loan | 0% | None required | No |
| USDA | 0% | 640 typical | Low annual fee |
Over 2,000 down payment assistance programmes exist in the US, many offering $5,000-$25,000 in grants or zero-interest loans. Use HUD's DPA locator at hud.gov to find programmes in your state.
Step-by-step: buying your first home in 2026
1. Check your credit score. Aim for 620+ for conventional, 580+ for FHA.
2. Save for down payment AND closing costs. Closing costs run 2-5% of the loan amount ($6,000-$15,000 on a $300K mortgage).
3. Get pre-approved — not just pre-qualified. Pre-approval requires income verification and a credit pull. Sellers will not accept offers without it in competitive markets.
4. Apply for down payment assistance. Ask your lender about state-specific DPA programmes before assuming you need a full 20% down.
5. Close the deal. Never skip the home inspection ($300-$500). Review the Closing Disclosure 3 days before closing carefully.
Use our Mortgage Calculator to see your exact monthly payment and how down payment size affects your total cost.