Any first-time home buyer in Utah will have plenty of questions about where to start.  Here are the answers to the most common questions agents hear from home buyers.

First Time Home Buyer In Utah

Being a first-time home buyer in Utah is a complex process to navigate.  As a homeowner and full-time discount real estate agent,  I understand how stressful buying your first home can be. So I wrote the article I wish existed when I bought my first house.

You will learn about the different home loan options, down payment assistance options, how to find the best realtor, contract deadlines, and when you get the keys to your new home.

After reading this article, you will know how to make your home-buying experience as smooth as possible.

There are a lot of costs when buying your first home. We recommend you start saving money early.

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What is a mortgage down payment?

A mortgage down payment is the amount a first-time home buyer in Utah must pay at closing to the lender. The down payment amount depends on the type of loan and is based on a percentage of the property’s final purchase price.

The purpose of a down payment is to reduce the lender’s risk by providing some equity in the property. It also demonstrates the borrower’s financial stability.

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Types of loans and down payments

Utah home buyer mortgage down payment requirements

How much down payment is required for an FHA loan?

Federal Housing Administration (FHA) loans require a minimum down payment of 3.5% of the home’s purchase price. For example, if the home’s purchase price is $500,000, the minimum down payment would be $17,500.

The property must be the buyer’s primary residence to qualify for FHA loan programs.

FHA loans are a popular option for first-time home buyers and buyers with low credit scores or smaller down payments. They have more flexible underwriting requirements than conventional loans but are more strict about the condition of the property being purchased. FHA will not lend on a home with cracked windows, cracked concrete, chipped paint, or roofs with less than a two-year physical life expectancy.

Additionally, FHA loans have other associated costs, such as mortgage insurance premiums (MIP).

How much down payment is required for a VA loan?

Department of Veterans Affairs (VA) home loan benefits-eligible veterans, active-duty service members, and surviving spouses. One of the main benefits of a VA loan is that it does not require a down payment.

Yay, no down payment! Don’t get too excited. That doesn’t mean you won’t need money at closing.

VA loans have closing costs, which the borrower must be prepared to pay during Settlement.

How much down payment is required for a Conventional mortgage?

Conventional loan buyers must make a down payment between 5-20% of the purchase price. If the buyer can put 20% down, they will benefit by eliminating private mortgage insurance(PMI).

However, most first-time home buyers are not in a financial position to put even 5% down. Luckily, there is something called the Conventional 97, which is only available to first-time home buyers. Conventional 97 allows first-time home buyers to only make a 3% down payment on a primary residence.

How much down payment is required for a USDA loan?

United States Department of Agriculture (USDA) home loans benefit lower-income borrowers and don’t require a down payment. Zero down payment! Doesn’t get much better than that.

However, USDA borrowers still need to plan on having some cash set aside to cover their closing costs at Settlement.

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Buyer’s Closing Cost

Home buyers’ closing costs are additional fees and expenses paid by the buyer and seller in a real estate transaction.

As a general rule, closing costs are higher for the buyer than for the seller since the buyer is responsible for paying lender fees, appraisals, credit reports, the lender’s title insurance, title company fees, and recording fees.

It is important to understand the closing costs associated with a real estate transaction and budget for them as part of the home-buying process. Home buyer closing costs vary greatly depending on the lender they work with. Most transactions in Utah should not cost a buyer more than $6,000 in closing costs. If your closing costs are higher, you should look for another lender.

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Pre-Approval vs. Pre-Qualification

Talk to a loan officer.  You don’t want to fall in love with a home and find out you’re not qualified to purchase your dream home.

A home buyer’s pre-approval and a home buyer’s pre-qualification are two different things.

A home buyer pre-approval is a more comprehensive process than a pre-qualification. The buyer must submit a mortgage application and document their income, employment, and other assets. The lender will review the borrower’s credit history, debt-to-income ratio, and other factors to determine the maximum loan amount the borrower will qualify for.

A pre-approval letter indicates that the buyer is a more serious buyer than a buyer with a pre-qualification letter. Pre-approved home buyers are considered more serious to sellers and listing agents.

A pre-qualification is a less formal process than a pre-approval. To get pre-qualified, the buyer typically answers a few basic lender questions about their financial situation and loan amount. The lender will provide a pre-qualification letter based on the information provided by the borrower, but no documentation is required. A pre-qualification letter is considered a much less reliable buyer by the seller's realtor. A good listing agent will require the buyer to provide a pre-approval letter before recommending the seller accept the buyer’s offer.

If you’re a serious home buyer, don’t miss out on the home you want because you could not provide the listing agent with a pre-approval letter. Most offers accompanied by a pre-qual letter will be denied.

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Don’t be house poor. 

house poor in Utah

Determine the price you can afford (not approved for) before shopping for your new home. Then stick to your budget

How much you’re approved for vs. how much you can afford.

Understanding the difference between how much you are approved for and how much you can afford to pay for a home is important. Being “house poor” sucks! Don’t worry about keeping up with the Jones.

Too often, home buyers make the mistake of buying a home that maxes out their loan approval, only to find themselves in a tough financial situation once they move in.

We think home buyers should focus on the monthly payment more than the purchase price.

Sticking to a monthly payment that you can comfortably pay instead of maxing yourself out financially only to be left looking under sofa cushions for spare change to cover this month’s mortgage payment will save you lots of unnecessary stress. You can always buy a bigger, nicer home in the future once your current home goes up in value.

To avoid being house poor, we recommend keeping your housing expenses, including your mortgage payments, property taxes, and insurance, at or below 28% of your gross monthly income. You should also consider your overall debt-to-income ratio at or below 36%.

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First-Time Home Buyer Qualifications


Who qualifies as a first-time home buyer in Utah?

In Utah, a first-time home buyer has not owned an owner-occupied home in the past three years. This applies to single-family homes and townhomes, and condos.

If you have owned a home in the past three years, you may still qualify for specific down payment assistance programs. Contact a qualified lender for clarification.

First-time home buyers can not own any investment properties.

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Down Payment Assistance

Utah home buyer down payment assistance

What is Utah Housing Corporation?

Utah Housing Corporation (UHC) offers payment assistance programs for qualified first-time buyers who lack the funds for the down payment necessary to purchase a home. Here are three great down payment assistance programs offered by UHC.

FirstHome Loan

FirstHome Loan is a down payment assistance program for low or moderate-income borrowers that qualify for FHA or VA Loans.

The borrower is not required to complete a home buyer education course.

Allowable down payment assistance is 6% of the loan amount, including mortgage insurance premiums (MIP).

The FirstHome Loan requires Utah home buyers to have a minimum credit score of 660.

Debt to income (DTI) can not exceed 45% of the borrower’s gross monthly income (before taxes).The property can only be one unit.No portion of the home can be used as a rental.

Home Price Limits By County.
  • Beaver, Cache, Carbon, Daggett, Emery, Grand, Millard, Rich, Sevier, and Uintah home prices can not exceed $349,500.
  • Box Elder Davis, Morgan, Summit, Wasatch, and Weber home prices can not exceed $536,900
  • Duchesne, Garfield, Iron, Kane, Piute, San Juan, Sanpete, and Wayne home prices can not exceed $427,100
  • Juab and Utah home prices can not exceed $516,100 Salt Lake, and Tooele home prices can not exceed $434,700
  • Washington home prices can not exceed $400,300

HomeAgain Loan

HomeAgain Loan is a payment assistance program for low- or moderate-income borrowers who qualify for FHA or VA Loans.

The borrower is not required to complete a home buyer education course.

Unlike the FirstHome Loan program, the HomeAgain Loan does not have a purchase price limit and can be 1-2 units. 

Allowable down payment assistance is 6% of the loan amount, including mortgage insurance premiums (MIP).

The HomeAgain Loan requires the Utah home buyer to have a minimum credit score 660.

Debt to income (DTI) follows FHA loan guidelines. Co-borrower (DTI) is 45% of the co-borrower’s gross monthly income (income before taxes).

No portion of the home can be used as a rental.

Score Loan

The Score Loan is a down payment assistance program for borrowers with low to moderate incomes that do not meet the credit requirements of HomeAgain or FirstHome and qualify for FHA loans or VA Loans.

Allowable down payment assistance is 4% of the loan amount, including mortgage insurance premiums (MIP).

The Score Loan requires the Utah home buyer to have a minimum credit score of 620. Debt to income (DTI) is 45% of the borrower’s gross monthly income (income before taxes).

No portion of the home can be used as a rental.

Utah Housing Corp income and purchase price limits.

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How to hire the best Utah Realtor.


Hiring the best realtor is an important step in the home-buying process, but let’s face it, most real estate agents are not very good at what they do. 

Look for an experienced agent or, better yet, an Associate Broker or Principal Broker since they met a minimum number of transactions, additional schooling, and passed a higher level of state testing. Real estate agents are required to work under a broker.

Look for agent reviews on websites like Google ( Reviews), Zillow, or Reviews can be beneficial when deciding which agent is a good fit for you and your family.

It’s not bad to save money by working with an experienced discount real estate agent.

So to sum it up, hire an experienced discount agent with a personality compatible with your own since you’ll spend a lot of time with him or her.

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Search for homes on the Utah MLS.

The Utah MLS (Multiple Listing Service) is a database of all real estate for sale through a brokerage in Utah. The MLS, or its public website, is the best website to search for your new home. This is where real estate agents list new homes to market to agents and home buyers.

Other sites like Zillow and have a better user experience than the MLS but receive their listing data through an MLS listing feed. These listing feeds have short delays when pulling the listing data from the Multiple Listing Service, so the user will not always have access to up-to-date listing information like what is listed on

Home buyers have many options for searching for homes. They must decide if they prefer 100% accurate information or a sleek design.

If buyers don’t have time to search for homes constantly, they can have their agent set up an automated MLS home search that will email them when a new home meeting their requirements hits the market.

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Attend open houses.

utah open houses

Experienced real estate agents often work with dozens of home buyers. Unfortunately, our time is finite, so realtors can’t show homes to every buyer daily. Attending open houses is an excellent way for buyers to see more homes when their agent is unavailable.  

Open houses also provide buyers flexibility since they don’t need to work around their agent’s availability.  

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Builder-model homes

Walking through a new model home from your favorite home builder is a fun way to shop for a home. It’s important to remember that the real estate agents in the model home represent the builder.

Agents In Model Homes Are Not Your Friends

Failure to register your agent with the builder’s agent while touring a model home may forfeit your right to have a buyer’s agent represent your best interest. 

Be careful not to share too much information with them, and always register your agent with the builder’s agent.  Failure to register your agent may forfeit your right to have a buyer’s agent represent your best interest. This is a dirty little trick builder’s play.

Going straight to the builder’s agent to save the commission isn’t your best move. Builders are unlikely to reduce the price for an unrepresented home buyer. Unrepresented home buyers equal twice the work for the builder’s agent.

Work with a discount agent who will rebate a portion of their commission. This way, you save some of the real estate commission while having an experienced agent represent your best interest.

Register Aaron Peters as your agent with any home builder to receive a commission rebate. Here’s the information for the home builder to register Aaron as your agent.

Aaron Peters 801-243-8900
NetLogix Realty
License # 6390407-AB00

Negotiate A Purchase Offer

An experienced Realtor can play a key role in negotiating an offer for a first-time home buyer. When a buyer is interested in purchasing a property, the realtor will pull comparable sales in the area to arrive at the home’s value and offer price.

In addition to the purchase price, the agents should be prepared to negotiate the amount of earnest money, the buyer’s closing cost to be paid by the seller if any, any homeowners association (HOA) transfer fees, possession date, the buyer’s Due Diligence Deadline (inspection period), any repairs discovered during the inspection, and the buyer’s Financing & Appraisal Deadline. 

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Real Estate Contract deadlines

The Buyer’s Earnest Money Deposit Deadline

Earnest money is applied towards the buyer’s down payment at Settlement but must be received by the buyer’s brokerage four calendar days after the contract has been accepted. Utah’s typical earnest money amount is one percent of the purchase price.

The Seller’s Disclosure Deadline.

The seller is required to disclose any past or present property defects known to the seller on the Seller’s Property Condition Disclosures. The due date is negotiable but should always be before the Due Diligence Deadline.

It is important to note that the seller’s disclosure form is not a substitute for inspecting the property. The buyer is responsible for hiring a professional inspector to examine the property.

The Buyer’s Due Diligence Deadline

During this time, the buyer is responsible for performing any necessary inspections or investigations to determine the property’s condition and ensure that it meets the buyer’s needs and expectations.


Utah home buyer inspection deadline

The buyer can cancel the contract before the Due Diligence Deadline without any reason or penalty.

Appraisal & Financing Deadline

The Financing & Appraisal Deadline will be negotiated but is usually around three weeks after the offer is accepted. An appraisal is a lender requirement to ensure the property is worth the borrowed money.

Suppose the buyer and the buyer’s lender must work diligently to finalize financing by the deadline specified in the purchase agreement. This is the last day the buyer can cancel the contract and receive their earnest money deposit. Buyers should be very confident in their ability to close the transaction at this point in the home-buying process. After 5 pm on the Financing & Appraisal deadline, their earnest money will be released to the seller if they can not cancel the contract for any reason.

Final Walk-Through

The final walk-through is a visual inspection conducted by the buyer and their real estate agent before closing the sale. The final walk-through ensures that the property is in the same condition as when the purchase agreement was signed and that any agreed-upon repairs have been completed.

The buyer can request a final walk-through seven days before Settlement.

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Wire Cash To Close.

Utah wire fraud real estate

Wire fraud is a financial scam involving electronic wire transfers when hackers intercept the wire instruction and input bank information they can access. If a buyer receives wire instructions in an email, they should ALWAYS contact the title company to verify their wire instructions and bank account number before sending the wire.

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Sign Docs At Settlement

Settlement is the final step in the home purchase process in Utah. Settlement is when the buyer meets with the Escrow Officer to sign all required closing documents, and cash to close is wired to the title company.

The real estate transaction is not complete once they sign. Don’t show up to Settlement with a moving van since the transaction will take hours or sometimes the next day to finalize.

Fund & Record

In a real estate transaction in Utah, the term “fund and record” refers to transferring the funds to purchase the property and recording the transfer of ownership in the county records.

The real estate transaction is complete once the title company confirms they have funded and recorded.

Congratulations! You’re not a first-time home buyer anymore.

Call Utility Companies

Don’t forget to transfer all utilities in your name.

This should be done after Settlement, and the title company should provide the buyer with a list of utility companies and their contact info to make the hectic process a little smoother.

Keys To Your New Home

The keys are in a Realtor key box, so most of the time, the buyer’s agent will arrange a time to meet the buyer at their new home and give them the keys to their new home.

Utah first time home buyer keys to house

Change Your Locks

You don’t know who has a copy of the keys to your new home, so change the locks immediately. Or don’t and see if you get a surprise visit from a stranger.

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Commission Rebate Check

Utah commission rebate check

Savvy home buyers will work with a discount agent like Aaron Peters and receive a commission rebate check.

discount agent blog topic dividerThis post was about providing first-time home buyers in Utah with a game plan for success.  Now you should know how to start your journey from loan application to getting keys to your new home.
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