Buying a $300k House: Down Payment, Mortgage & Budget Basics

If you’re eyeing a $300,000 home, the first question is usually “How much do I need up front?” Most lenders expect a 20% deposit, which works out to $60,000. That number can feel huge, but there are ways to shrink the gap.

How to Save or Source Your Deposit

Start by looking at your monthly cash flow. Cut non‑essential subscriptions, pause that pricey gym membership, and set a realistic savings target. Even a modest £300‑£500 extra each month adds up to £3,600‑£6,000 a year. Pair a solid savings plan with government schemes – many regions offer first‑time buyer assistance that can cover part of the deposit.

If you have equity in another property, a home equity loan could free up cash for the $60k. Just be sure the new loan’s interest rate is lower than what you’d pay on a mortgage, otherwise you might end up paying more in the long run.

Mortgage Amount and Affordability

With a $300k price tag and a 20% deposit, you’ll need a $240,000 mortgage. Lenders typically want your total monthly housing costs – mortgage, taxes, insurance – to stay under 30% of your gross income. Using a 4% interest rate over 30 years, the monthly payment lands around $1,150. Add council tax and insurance, and you’re looking at roughly $1,400 a month.

To qualify, aim for an annual household income of at least $55,000‑$60,000. If your income is lower, consider a longer loan term or a slightly lower‑priced home to keep payments manageable.

Remember, the “affordability” number isn’t set in stone. Lenders also check your debt‑to‑income (DTI) ratio. Keep existing debts – credit cards, car loans – low, and avoid taking on new credit just before you apply.

Finally, shop around. Different banks and building societies offer varied rates. Even a 0.25% difference can save you thousands over the life of the loan.

Buying a $300k house is within reach as long as you break the process into bite‑size steps: save a realistic deposit, check your income against the needed mortgage, and compare lenders. With clear numbers in front of you, you can move forward confidently and avoid nasty surprises later.