First-Time Homebuyer’s Guide: 8 Steps to Buying in California

Buying your first home comes down to five stages: get your finances ready, get pre-approved, choose an agent and sign a buyer agreement, find a home and make an offer, then complete inspections, the appraisal and closing. Most of the stress comes from skipping steps or rushing the money side, so start there.

This guide is written for first-time buyers in California, with notes for Sonoma, Napa, Marin and the wider North Bay. A few rules changed recently, including how buyer agents are hired. Rates are higher than many buyers hoped: Freddie Mac’s survey put the 30-year fixed average at 7.32 percent for the week of October 22, 2026.

Step 1: Get your finances ready

• Check your credit. Pull your reports, dispute errors and pay down card balances. Avoid opening new credit before and during the loan process.
• Set a monthly budget. Count principal, interest, property tax, insurance, HOA dues and maintenance, not just the loan payment.
• Know your cash needs. You will need a down payment, closing costs and a cushion left over after closing.
• Gather documents. Recent pay stubs, W-2s or tax returns, bank statements and ID.

Property taxes in California start at about 1 percent of the purchase price under Prop 13, plus any local voter-approved bonds and assessments. Ask for the actual tax rate on any home you consider.

Step 2: Pick a loan and get pre-approved

You do not need 20 percent down. Common first-time options:

Loan size matters too. FHFA’s 2026 conforming limit for a one-unit home is $897,000 in Sonoma County, $1,017,750 in Napa County and $1,249,125 in Marin. Larger loans are jumbo loans with stricter rules. Our guide to the different types of home loans goes deeper.

Get a full pre-approval, not just a pre-qualification. Shop at least two or three lenders. Each must give you a Loan Estimate within three business days of your application, which makes it easy to compare rates, points and fees.

Step 3: Look into down payment help

The California Housing Finance Agency (CalHFA) pairs first mortgages with assistance:

• MyHome: a deferred-payment second loan of up to 3.5 percent of the price with an FHA loan, or 3 percent with conventional. No payments until you sell, refinance or pay off the first loan.
• Dream For All: a shared-appreciation loan of up to 20 percent of the price for first-generation buyers who meet income limits. The 2026 round took applications from February 24 to March 16 and chose recipients at random. Watch CalHFA for future rounds.

Some cities and counties run their own programs. Ask your lender which ones it can combine with your loan.

Step 4: Choose an agent and sign a buyer agreement

Since January 1, 2025, California law (AB 2992) requires a written buyer representation agreement no later than when you sign an offer. Under the national settlement, it is required before an agent tours a home with you. The agreement:

• Cannot last longer than three months from signing
• Must state the agent’s compensation, the services provided and when payment is due
• Sets the most the agent can receive from any source for representing you

Read it, ask questions and negotiate terms before you sign. Our list of tips for choosing a real estate agent can help you interview candidates.

Step 5: Decide what you need and where

Write down your must-haves and nice-to-haves: bedrooms, commute, yard, parking, ADU potential. Then compare towns. Prices across the North Bay vary a lot. Many first-time buyers compare Santa Rosa homes for sale with Rohnert Park, Petaluma and Solano County towns such as Vacaville.

Visit at different times of day. Check the commute at rush hour, noise from roads or rail, and the fire hazard severity zone for any home you like. Name the school district if it matters to you, and research the district directly.

Step 6: Make an offer

Your agent will pull recent sales and help you set a price and terms. A California offer typically includes:

• Price and earnest money deposit
• Contingencies for inspections, the appraisal and the loan, each with a deadline
• Closing date and who pays which costs
• Any requests for seller credits, for example toward a rate buydown

In a slower market you may be able to negotiate. In a hot one, terms such as shorter contingency periods may matter as much as price. Do not waive protections you cannot afford to lose.

Step 7: Inspections, disclosures and the appraisal

Hire a general home inspector, plus specialists as needed: roof, sewer lateral, foundation, pest, chimney. Rural homes often need well and septic inspections. See our guide to wells, septic and rural utilities in Sonoma County.

Read every seller disclosure. In high and very high fire hazard severity zones, sellers must provide defensible space documentation under Civil Code 1102.19, or the buyer agrees to obtain it, often within a year after closing. Get homeowners insurance quotes early, before you remove contingencies.

The lender orders an appraisal. If it comes in low, you can renegotiate, bring more cash or, if you kept your appraisal contingency, cancel.

Step 8: Close and move in

You will receive a Closing Disclosure at least three business days before closing. Compare it line by line with your Loan Estimate and ask about any change. Wire funds only after confirming instructions by phone with your escrow officer, using a number you already have. Wire fraud is a real risk.

After closing, keep your documents, set up utilities, change the locks and file for the homeowners’ exemption with the county assessor if it is your main home.

Questions people ask

How much do I need to save to buy my first home?

It depends on the price and loan. With 3 to 3.5 percent down, plus closing costs and reserves, many buyers need several percent of the price in cash. Down payment assistance can reduce that.

What credit score do I need?

Requirements vary by loan program and lender. FHA is generally more flexible than conventional. Ask two or three lenders what you qualify for.

Do I have to pay my agent?

Your buyer agreement says what your agent is paid and by whom. Sellers sometimes offer to cover some or all of it, which you can request in your offer.

How long does buying a home take?

Searching can take weeks or months. Once your offer is accepted, escrow commonly runs about a month, depending on your contract and loan.

When you are ready to start, walk through our buying process, read the first-time buyer’s guide to Sonoma, or reach out to our team to set up a planning call.

Sources & notes

• Primary Mortgage Market Survey, Freddie Mac (week of October 22, 2026)
• Conforming Loan Limit Values, 2026, Federal Housing Finance Agency
• HomeReady Mortgage, Fannie Mae
• Homebuyer Programs, California Housing Finance Agency
• Dream For All Will Resume Accepting Applications in February, CalHFA via Business Wire (January 2026)
• Consumer Alert: Changes to Real Estate Representation, California Department of Real Estate
• What Is a Loan Estimate? and What Is a Closing Disclosure?, Consumer Financial Protection Bureau
• Understanding California’s Property Taxes, Legislative Analyst’s Office
• California Civil Code Section 1102.19 (via Justia)

Last reviewed October 2026 by Matthew Martinez.