What You Actually Need to Buy Your First Home in Reno

I've sat across from a lot of first-time buyers in 25 years, and most of them walk in believing the same thing: that they need 20 percent down. They've run the math on a Reno home, landed somewhere north of a hundred thousand dollars, and quietly decided homeownership is a few years off. Then we actually talk, and most of them find out they were closer than they thought. Sometimes years closer.

Here's what's actually true.

The 20 percent myth

Twenty percent down is not a requirement, and it never really was. It's the number that lets you skip mortgage insurance. That's useful, but it is not the price of admission.

A conventional loan can be done with 3 percent down. FHA sits at 3.5 percent. If you've served in the military, a VA loan can be zero down. USDA loans, for homes in the right areas around Northern Nevada, can also be zero down.

Put real numbers on it. The median single-family home in the Reno-Sparks area sold for about $611,000 this April, according to Sierra Nevada Realtors. Twenty percent of that is roughly $122,000. Three percent is closer to $18,000. Same house. A completely different timeline for getting into it.

The help most people leave on the table

Here's the part that genuinely bothers me. Nevada has down payment assistance programs built for buyers in exactly your position. Every year, money in those programs goes unused. Not because people don't qualify, but because nobody told them to ask.

There are income limits, and not every buyer fits. But far more people qualify than ever find out. When we sit down, that's one of the first things I check, because it can change your whole picture.

The real costs, so nothing surprises you

Your down payment is not the only cash you'll need, and I'd rather you hear that from me now than at a closing table.

Plan for closing costs, usually somewhere around 2 to 5 percent of the loan amount. Plan to keep a little in the bank afterward, because lenders like to see reserves and honestly, so should you. And understand that your credit score does real work here. The same house and the same loan, with a strong score versus a weak one, can be a couple hundred dollars a month apart.

If your credit needs a few months of attention before you buy, that isn't bad news. That's a plan, and it's a plan worth making.

Should you wait?

The question I get more than any other: should I wait for rates to drop, or for prices to come down?

My honest answer, after watching this market a long time, is probably not. And here's the reasoning.

Reno is not a market sitting on a pile of empty houses. Inventory is tight, well below what a balanced market looks like, and people keep moving here, a good number of them from California. When rates do ease, the buyers who've been waiting on the sidelines tend to rush in all at once, and that competition pushes prices up. You can win on the rate and lose on the price.

Remember this: your rate, you can change later with a refinance. The price you pay for the house is locked in the day you buy it.

The honest first step

None of this means you should buy before you're ready. It means "ready" is usually a more specific number than the vague one in your head, and you deserve to know the real one.

That's the whole job, and it's the part I like best. Give me a call and we'll pull your actual numbers, look at which loan and which assistance programs fit you, and figure out whether your first home in Reno is years away or a lot closer than you think.

No pressure and no sales pitch. Just the real picture.

Art Loera, Mortgage Branch Manager, PRMG. Reno, NV. NMLS #367308, licensed in Nevada. PRMG NMLS #75243. Branch NMLS #1091868. This article is general information, not a loan commitment or financial advice.