FAQs

What is the first step in buying a home in California?
The first step is often getting pre-approved for a mortgage. This involves working with a lender to determine how much you can afford, which helps narrow down your home search and strengthens your offer when you find the right place.


How much should I expect for a down payment?
In California, the standard down payment is typically 20% of the home's purchase price, but many lenders offer options as low as 3% to 5% for qualified buyers. Keep in mind that a lower down payment might require private mortgage insurance (PMI).


What is escrow, and how does it work in California?  
Escrow is a neutral third party that holds funds and documents until all conditions of the sale are met. This process ensures both the buyer and seller fulfill their obligations before the transaction is completed.


Are there any special taxes or fees I should be aware of?
Yes, be prepared for property taxes, which are based on the home's assessed value. Additionally, you'll encounter closing costs, which typically range from 2% to 5% of the purchase price. California also has specific transfer taxes that vary by county.


Do I need a real estate agent to buy a home?
While it's not legally required, having a knowledgeable real estate agent is highly beneficial. They can guide you through the complex process, negotiate on your behalf, and provide insights on local market conditions.


What are contingencies, and should I include them in my offer?
Contingencies are conditions that must be met for the sale to proceed, such as home inspections or loan approval. Including contingencies can protect you from unforeseen issues, but too many may make your offer less appealing in a competitive market.


Can I back out of a purchase agreement?
Yes, but there are conditions. If contingencies are not met, you can withdraw without penalty. However, backing out for other reasons could result in losing your earnest money deposit.


How does the inspection process work in California?
A home inspection is a thorough examination of the property's condition, typically conducted after your offer is accepted. It identifies potential issues, giving you the opportunity to renegotiate the terms or request repairs.


What should I know about buying a home in a wildfire-prone area?
If you're considering a property in a high-risk fire zone, research local building codes and fire safety measures. Insurance costs may be higher, so factor that into your budget. Additionally, some areas may require specific fire prevention modifications.


Are there any state-specific programs for first-time homebuyers?
Yes, California offers several programs to assist first-time buyers, including down payment assistance and favorable loan terms. Look into options like the CalHFA FHA Loan or CalPLUS FHA with ZIP for Zero Interest Program.