General information only, not financial or legal advice. Home-buying rules vary by country and state; speak to a qualified professional for your situation.
This guide is for a first-time buyer in the United States who has been renting for a few years, has some savings and is starting to scroll listings late at night. Perhaps a couple tired of rent rises, or a single buyer who wants stability. Buying a home is usually the largest purchase a person makes, and most of the costly mistakes come from questions nobody asked in time.
The questions below are grouped by who you should be asking. Several draw on the free home-buying tools from the US Consumer Financial Protection Bureau at its Buying a House hub, which is worth bookmarking.
Questions to ask yourself
How long do I expect to stay?
Buying and selling carry large transaction costs: lender fees, title insurance, inspection, moving, and on the sale side, agent commissions and taxes. Those costs are typically spread over the years you live there. If there is a real chance you will move for work within two or three years, renting may cost less overall.
What can I comfortably afford each month?
The amount a lender will approve is not the same as the amount you can live with. Build a monthly figure that includes the full payment, not just principal and interest:
- Principal and interest on the mortgage
- Property taxes
- Homeowners insurance
- Private mortgage insurance, if your down payment is small
- Homeowners association or condo fees
- Utilities, which are often higher than in a rental
- A maintenance fund, commonly budgeted at around 1 percent of the home’s value a year as a rough starting point
Then compare that total with your take-home pay and your other goals, such as retirement saving and an emergency fund.
Will I still have savings after closing?
Plan to keep a cash cushion after the down payment and closing costs. New homeowners often face an unexpected repair in the first year, and a buyer who empties their accounts at closing has nothing left for it.
Questions to ask lenders
Can I see a Loan Estimate?
Every lender you apply with must give you a standard three-page Loan Estimate, which shows the interest rate, monthly payment and closing costs in the same format. The CFPB’s Loan Estimate explainer advises requesting multiple Loan Estimates from different lenders so you can compare, and says the best way to tell whether an offer is competitive is to compare it with estimates from other lenders, paying particular attention to origination charges.
What are the points and fees?
Lenders may offer a lower rate in exchange for paying “points” upfront. Ask how much each point costs, how much it lowers the rate, and how many years it would take to break even. If you might move before then, paying points rarely makes sense.
Is the rate fixed or adjustable?
An adjustable-rate mortgage may start cheaper but can rise later. Ask how often it adjusts, the maximum it can rise at each adjustment and over the life of the loan, and what your payment would be at that maximum.
Can I lock the rate, and for how long?
Rates change daily. Ask how long a lock lasts, whether it costs anything, and what happens if closing is delayed.
Compare Loan Estimates from several lenders. It is the single quickest way to tell whether an offer is competitive.
Questions to ask about the property
Why is the seller moving, and how long has it been listed?
The answer may not be candid, but the listing history is public on most property sites. A home that has been relisted several times, or reduced repeatedly, invites questions.
What are the running costs?
Ask for recent utility bills, property tax bills, homeowners association fees and any special assessments planned. A condo with low monthly fees and a large roof replacement coming may cost more than one with higher fees.
What has been repaired or replaced, and when?
Ask about the age of the roof, heating and cooling system, water heater, windows and electrics. Ask for receipts and permits for major work. Unpermitted additions can cause problems with insurance and resale.
What disclosures are required here?
Many states require sellers to disclose known defects. Read the disclosure form carefully, and ask a local agent or attorney what it does and does not cover in your state.
Questions to ask the inspector
A professional home inspection is one of the best-value costs in the process. Attend it if you can, and ask:
- What are the three most urgent issues, and roughly what might they cost to fix?
- Is there any sign of water damage, mould or foundation movement?
- How old are the major systems, and how long might they last?
- Do you recommend a specialist inspection, such as for the sewer line, radon, pests or the roof?
- What would you fix first if you bought this house?
Use the report to negotiate repairs or a price reduction, or to walk away if the problems are serious.
Questions to ask your agent
If you work with a buyer’s agent, they are a key source of local knowledge. Interview two or three before choosing one, and ask:
How are you paid, and what does our agreement say?
Ask the agent to explain exactly how their compensation works, who pays it, and what you are agreeing to in any written buyer agreement before you sign. Rules and practices around agent compensation have been changing in the US, so do not assume the arrangement a friend had a few years ago still applies.
How many first-time buyers have you worked with recently?
An agent used to guiding first-time buyers will explain each step instead of assuming you know it.
What do comparable homes nearby sell for?
A good agent can show recent sales of similar homes, not just asking prices, which helps you judge whether a listing is fairly priced and how much to offer.
What would make you advise against a property?
The answer tells you whether the agent will give an honest view or simply push towards a sale.
Questions about the neighbourhood
The house can be renovated; the location cannot. Before making an offer, visit at different times of day, including a weekday rush hour and a weekend evening, and ask:
- How long is the commute at the times I would actually travel?
- What are the local schools like, even if I have no children, since this affects resale?
- Is the home in a flood zone, and what would flood insurance cost?
- Are there planned developments, road changes or zoning applications nearby?
- What do neighbours say about the area if you knock and ask?
Questions to ask before closing
Do the final numbers match the estimate?
Before closing you will receive a Closing Disclosure with the final terms and costs. Compare it line by line with your Loan Estimate. Ask the lender to explain any increase.
What do I need to bring?
Ask how much money you need at closing, the accepted payment method, and which documents and identification to bring.
Is the wiring information genuine?
Fraudsters target home buyers with emails that appear to come from the title company or agent, giving new wiring instructions for the down payment. Always confirm wiring details by phone using a number you already know to be genuine, never one supplied in the email.
A simple decision table
| Question | Green light | Pause and think |
|---|---|---|
| How long will I stay? | Five years or more | Two years or less |
| Total monthly cost vs take-home pay | Leaves room for saving | Leaves little or nothing |
| Savings after closing | Several months of expenses | Close to zero |
| Loan Estimates compared | Three or more | Only one |
| Inspection findings | Minor or priced in | Major structural or water issues |
Home-buying question checklist
- Expected length of stay decided
- Full monthly cost calculated, including taxes, insurance and maintenance
- Post-closing cash cushion planned
- Loan Estimates requested from at least three lenders
- Points, rate type and rate lock understood
- Listing history, running costs and repair records reviewed
- Seller disclosures read
- Inspection attended, specialist checks booked if needed
- Closing Disclosure compared with Loan Estimate
- Wiring instructions confirmed by phone
Takeaway
The best protection for a first-time buyer is a long list of questions asked early. Be honest with yourself about time horizon and monthly cost, compare several Loan Estimates as the CFPB recommends, attend the inspection, and confirm every number and wiring instruction before closing day.
