How Much Money Do You Actually Need to Buy a House in Arkansas?
Updated: Oct 25
One of the first questions I get from buyers is: “How much money do I actually need to buy a house?” And unfortunately, the answer is not a nice, simple percentage.
You’ve probably heard that you need 20% down. You probably don’t. But you also may have heard about a 0% down loan and assumed that means you need absolutely no money to buy a house.
That isn’t always true either. There are several different expenses that can come up when you buy a home, so let’s break down where your money may actually go.
First: Your Down Payment
Your down payment is the portion of the purchase price you're paying upfront rather than financing. And no, 20% down is not required for most buyers. Depending on your loan and qualifications, options may include:
Conventional Loans
Conventional down payments can vary depending on the loan program and your qualifications, but some qualified buyers may be able to put as little as 3% to 5% down. Putting 20% down can have benefits, including potentially avoiding private mortgage insurance, but it isn't a requirement just because you're using conventional financing.
FHA Loans
FHA loans can allow qualified borrowers to purchase with a 3.5% down payment. That can make FHA a useful option for first-time buyers and buyers who may not fit perfectly into the conventional box.
USDA Loans
USDA loans can offer 100% financing for eligible borrowers purchasing eligible properties. There are USDA-eligible areas throughout Arkansas, including areas around Northwest and Central Arkansas that buyers don't always realize may qualify.
VA Loans
Eligible Veterans, active-duty service members and certain surviving spouses may be able to purchase with 100% financing using a VA loan. VA loans also don't have monthly private mortgage insurance. So yes, buying a house without making a down payment can absolutely be possible.
But there's another part of the equation.
Your Down Payment Is Not the Same Thing as Your Closing Costs
This is where buyers get confused. Your down payment goes toward the purchase price of the home. Your closing costs are expenses associated with getting the mortgage and completing the transaction.
Depending on your particular loan and transaction, those costs can include things like: • Lender and loan-related fees • Title and settlement costs • Appraisal • Prepaid homeowners insurance • Property tax-related amounts • Initial escrow deposits • Other transaction-specific expenses This is why I don't like telling someone, “You'll need X% to buy.” There are too many variables.
I'd rather calculate it based on the actual house, loan program and situation.
Could You Actually Bring $0 to Closing?
Yes. I have seen it happen. A zero-down loan doesn't automatically mean you'll bring $0 to closing because there can still be closing costs and prepaid expenses. But when the financing, seller concessions and other credits all line up, it is absolutely possible for a buyer to bring little or even $0 to closing.
I've had clients do exactly that. And the current market can make those conversations especially important. As of September 2026, Arkansas overall is considered a buyer’s market, which can give buyers more negotiating room than we've seen in some recent markets. Many of my clients right now are negotiating for the seller to cover most, and sometimes all, of their allowable closing costs.
That doesn't mean every seller will agree or that every house will have the same negotiating room. Seller contributions are also subject to the rules of your particular loan program. But it does mean we should look at more than just the price of the house when we're putting together an offer. Sometimes the terms of the offer can make a huge difference in how much money you actually need upfront.
What About Earnest Money?
Earnest money is another expense buyers often hear about once they start making offers. Think of earnest money as money you put forward with the contract to show that you're serious about purchasing the property. The amount can vary based on your contract and local market.
Here's an important distinction: Earnest money isn't necessarily an additional cost on top of everything else. When properly documented and credited as part of the transaction, earnest money can generally be applied toward amounts you owe at closing.
Your Realtor and lender can explain exactly how it works with your particular offer.
Don't Forget the Home Inspection
A home inspection is different from an appraisal. The appraisal is primarily about the property and its value as it relates to the loan. The inspection is for you.
Your inspector is looking at the home's condition and helping you understand what you're buying. Inspection costs vary based on the property and the inspections you choose to have performed. This is typically an expense you'll want to plan for early in the process.
And Then There's the Appraisal
Depending on the loan and transaction, an appraisal may be required. The appraisal helps establish the property's value for lending purposes and, depending on the loan type, may also address certain property requirements. Who pays for it and when it's paid can vary.
Again, this is why we calculate your actual scenario instead of giving you a random number from the internet.
Can the Seller Pay Some of My Costs?
Sometimes, yes. And right now, I'm seeing this happen pretty frequently with my own clients. Depending on your loan program, contract and transaction, the seller may be able to contribute toward certain buyer costs.
There are limits and rules depending on the type of financing, so your lender and Realtor should coordinate this before the offer is written. This is important because a seller contribution can make a significant difference in how much cash you need to bring to closing. Sometimes negotiating closing costs can be more valuable to a buyer than negotiating the exact same dollar amount off the purchase price.
That's why I like running the numbers before my clients write an offer.
What About Down Payment Assistance?
Some Arkansas buyers may qualify for programs that can help with down payment and/or closing costs. That can be incredibly helpful. But I don't automatically assume assistance is the best option just because it's available.
Sometimes assistance programs come with different rates, fees, repayment requirements or other conditions. I want to compare the entire financial picture. If one option gives you more assistance upfront but costs substantially more over time, you deserve to know that before deciding.
So Could I Really Buy With Very Little Money?
Potentially. I've seen buyers surprised in both directions. Some assume they'll need tens of thousands of dollars when they may have options requiring much less.
Others hear “zero down” and assume they won't need any money during the entire process. Neither assumption is a good way to plan. The amount you need depends on things like: • Purchase price • Loan type • Down payment requirement • Property taxes • Homeowners insurance • Closing costs • Seller contributions • Earnest money • Inspection and appraisal expenses • Assistance programs you may qualify for
That's why two people buying the exact same priced house could need very different amounts of cash.
What If I Don't Have Much Saved Yet?
Please don't automatically count yourself out. This is one of the reasons I encourage people to talk to me before they think they're ready. Maybe you're ready now.
Maybe there's a loan program you didn't know you qualified for. Maybe we need to work on credit first. Maybe you need to save another $2,000 instead of the $20,000 you assumed you needed.
Maybe buying right now doesn't make sense at all and we need a six-month plan. All of those are useful answers. What I don't want is for someone to spend another year renting because they assumed they couldn't buy and never actually checked.
Start With the Numbers, Not a Guess
If you're thinking about buying a home in Arkansas, we can start by looking at: What monthly payment feels comfortable? What do you currently have available for the purchase?
Which loan programs could fit your situation? From there, we can work backward and figure out a realistic price range and how much cash you may actually need. You don't need 20% saved before you're allowed to ask the question.
You just need a starting point. I'm Kayla Moore, a Mortgage Advisor serving buyers throughout Northwest Arkansas, Central Arkansas and beyond. I also work with buyers in Oklahoma and Missouri. If you're trying to figure out whether you're financially ready to buy, let's look at the actual numbers instead of guessing.
Know Moore. Worry Less.
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