Buying a home comes with a few big costs up front beyond just the monthly mortgage. Let’s break them down so you know what to expect in Arizona.
1. Down Payment
The down payment is the money you put toward the home up front before the rest is covered by your mortgage loan.
- For an FHA loan, the usual down payment is 3.5 % of the home’s price
- For conventional loans, it might be 5 % or more
- In some cases, people can put less than 5 % down, depending on the loan program and their credit
For example, on a $300,000 home:
| Down Payment Rate | Amount You’d Pay |
| 3.5 % | $10,500 |
| 5 % | $15,000 |
With the Supreme Dream DPA program, you may be able to cover part of that down payment using a second loan, which reduces how much cash you need initially.
2. Closing Costs
Closing costs are the fees and charges you pay when you finalize your home purchase. These might include appraisal, title insurance, inspections, recording fees, and more.
In Arizona, closing costs for buyers tend to fall between 2 % and 5 % of the home price.
For instance, if the home costs $300,000, closing costs might be somewhere between $6,000 and $15,000, depending on your loan, location, and fees.
3. Other Prepaid Costs & Reserves
Besides down payment and closing costs, you’ll also need to plan for:
- Insurance (homeowners insurance)
- Property taxes (often prepaid or prorated at closing)
- Escrow or reserve accounts (for future taxes and insurance)
- Inspections, surveys, or pest checks
These costs vary by location and home type, so your loan officer will help estimate them.
4. Total Money Needed at Closing
When you add it all up, here’s a rough example for a $300,000 home:
- Down payment (3.5 %) → $10,500
- Closing costs (assume 3 %) → $9,000
- Prepaid items & reserves → maybe $2,000–5,000
So in total, you might need $21,000 to $25,000 (or more) in cash. But with the Supreme Dream DPA program, the second loan can reduce how much cash you have to bring to the table up front.
5. How the Supreme Dream DPA Helps
Here’s how this program can change what you need:
- It can help cover part of your down payment
- It also helps with closing costs
- You still pay it back, but it’s built into your home purchase
This means less money out of pocket and more ability to buy sooner.
6. What You Can Do Now to Prepare
- Check your credit score
- Start saving what you can—even small amounts help
- Ask your lender to estimate closing costs in your area
- Talk with a real estate agent to get a feel for home prices in neighborhoods you like
- Use the Supreme Dream DPA pre-qualification to see how much of your costs could be covered
