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Purchasing a home is one thing, but purchasing a luxury home is a project at a different level. And if you’re planning to take out a $700,000 mortgage — one that’s just shy of the 2024 conforming loan limit of $766,550 — you’re going to need some pretty serious income to repay that debt. We’re talking about an annual income of around $180,000 – $200,000.

When it comes to qualifying for a mortgage, it’s more than just income that matters — and there’s no one-size-fits-all answer to the question, “What income do I need for a $700K mortgage?” That said, there are some important rules of thumb around how much of your income should be spent on a mortgage that can help you determine what’s appropriate for your income — and other factors that mortgage lenders look at during the qualification process.

Income Needed for a $700,000 Mortgage

Again, there’s no set income level required for a $700,000 mortgage — but a mortgage that large is likely to have a hefty monthly payment, which means you’ll need some decent cash flow to be able to make it work.

One rule of thumb states that your housing costs should be no more than 30% of your gross monthly income — that is, your income before taxes or any other deductions. We can use this rule to estimate how much income you need to make a $700,000 mortgage payment feasible.

How Much Do You Need to Make to Get a $700K Mortgage?

Let’s start by using a mortgage calculator to get a rough estimate of how much money per month a $700,000 mortgage will cost.

To create an example, we’ll assume the property value is $750,000, and that you start out with a $50,000 down payment. While your interest rate will vary depending on factors like market conditions and your credit score, we’ll put it at 7.00%, which is fairly typical as of the second quarter of 2024.

Plugging those numbers into the calculator, you’ll see that the estimated monthly payment comes out to about $4,657 per month. To make our 30% rule above even simpler, we can multiply that total by three to get a low-end ballpark income that’s appropriate for a payment that large. That figure comes to around $170,000 per year. Keep in mind, though, that this figure doesn’t include taxes and insurance, which can add an appreciable amount to that monthly bill. And if you’re putting down a smaller down payment, you’ll also have to pay private mortgage insurance (PMI). Add all that to the mix and you’re looking at an annual income requirement that is closer to $180,000 – $200,000.

For many Americans, that income requirement probably sounds pretty hefty: Per the most recent Census data from 2022, the median household income in the United States is $74,580. (Of course, exact income and cost-of-living figures vary by state.) Still, such a large loan may be within reach for some households — though it’s not just income that matters.

Recommended: The Best Affordable Places to Live by State

What Determines How Much House You Can Afford?

Income is obviously an important part of what qualifies you for a mortgage. After all, lenders are interested in your being able to repay the loan over time. However, your ability to earn enough money to support the payment is only one factor that goes into their overall assessment. While each lender has its own specific requirements and criteria, they all look at similar factors.

What Mortgage Lenders Look For

Some of the factors lenders consider when qualifying a borrower for a mortgage include:

•   Income

•   Job stability

•   Credit history and credit score

•   Existing debt

•   Existing assets, such as bank and investment accounts

•   Money available for down payment

To verify all this information, your mortgage loan officer will likely ask for documentation including your tax returns, W-2s, pay stubs, bank statements, and potentially more. Speak with your loan officer directly to learn exactly what you’ll need to submit as part of the mortgage preapproval process.

What Is a Good Debt-to-Income Ratio?

Let’s take a closer look at one very important part of your mortgage application: your debt-to-income (DTI) ratio. This important measurement is expressed as a percentage, and shows lenders how the debt you already carry compares to your available monthly income. It’s calculated by dividing your monthly debts over your gross monthly income.

While, again, specific requirements vary, most lenders require a DTI of 36% or lower, though in some cases borrowers can be qualified with a DTI of up to 50%. Generally speaking, though, the lower your DTI, the better; even if you can qualify with a higher amount of debt, it’ll be more difficult to make your monthly payments.

$700,000 Mortgage Breakdown Examples

As we’ve seen above, in order to qualify for a $700,000 mortgage loan, you’ll likely need a household income of at least about $180,000 per year — although again, whether or not you qualify will depend on many factors aside from your income, like your credit score and existing level of debt.

One way to get a good sense of how much house you can afford at your current income level is to use a home affordability calculator. If you toggle the “advanced” settings, you can also include costs like homeowners insurance and property taxes along with your income and existing debts. The calculator will spit out an estimate of how much house you can afford given all these circumstances — but remember, again, that this is only an estimate and not a guarantee.

Pros and Cons of a $700,000 Mortgage

Like any financial product (and anything in life), a $700,000 mortgage has both drawbacks and benefits to consider. Here are a few to keep in mind.

Pros of a $700,000 Mortgage

•   Home appreciation may pay for the amount you spend in interest and prove a worthwhile investment

•   Home ownership offers stability

•   If you make timely payments, your mortgage could reflect positively on your credit history — and boost your credit score over time

Cons of a $700,000 Mortgage

•   A mortgage is still a form of debt, and you will pay for the loan in the form of interest

•   When you own your home, you’re responsible for any and all maintenance and repairs — which isn’t true for those who rent

•   Depending on your interest rate, you may end up paying far more than the original home price over the loan’s lifetime

How Much Will You Need for a Down Payment?

There’s an old rule of thumb that states you should save up at least 20% of the home’s purchase price for a down payment. On a property listed for more than $700,000, that would come out to at least $140,000 — a pretty sizable chunk of change to save up!

However, these days, even conventional loans allow some first-time borrowers to put down as little as 3.00% on their home purchase — which, in this case, comes out to a far more reasonable $21,000. There is a caveat to be aware of, though: Borrowers who put down less than 20% will likely be required to pay PMI, which can add a few hundred dollars a month to your mortgage payment. Still, for those who have the cash flow to support this additional cost, it can be a worthy trade for earlier access to homeownership.

Can You Buy a $700K Home With No Money Down?

Some mortgage programs do allow borrowers to take out a mortgage with no money down — though you may have to meet certain eligibility requirements to qualify. For example, government-backed loans from the U.S. Veterans Administration (VA) and U.S. Department of Agriculture (USDA) loans don’t have a minimum required down payment, though these are only available to service members, veterans, and their families or to those looking in designated rural areas, respectively.

Is a $700K Mortgage With No Down Payment a Good Idea?

Even if you do qualify for a $700,000 mortgage with no down payment, it may not be the best idea financially speaking. Along with potentially being on the hook for the additional expense of mortgage insurance, you’ll start out with very low equity in your new investment, and your monthly payments may be substantially higher than they would be otherwise.

Can You Buy a $700K Home With a Small Down Payment?

Short answer: Maybe! As we’ve discussed, your ability to qualify for a mortgage is multifactorial, and the size of your down payment is only one of the many pieces mortgage lenders will consider. If the rest of your application is solid, a lender may qualify you for a $700,000 mortgage with a down payment as low as 3.00% ($21,000) if you’re a first-time homebuyer. Again, though, the only way to know for sure is to actually apply.

Can’t Afford a $700K Mortgage With No Down Payment?

If you’re not yet in financial shape to afford a $700,000 mortgage, or the process of saving up a down payment is getting you, well, down, there are steps you can take to get ready to make the purchase.

Pay Off Debt

It may be one of the most common tips to qualify for a mortgage — but it’s for good reason. Having even a small amount of debt can seriously impact your buying power, so paying off what you can and lowering your DTI can go a long way toward making a larger mortgage possible.

Look into First-Time Homebuyer Programs

If you’re a first-time buyer, it’s worth looking into first-time buyer programs that may be able to help you with your down payment or qualify you for a mortgage when you might otherwise not. One of the best-known first-time homebuyer programs is the FHA mortgage, which is backed by the Federal Housing Administration and may help you qualify even with a lower credit score.

Build Up Credit

Along with lowering your overall debt, building up your credit score can also help you qualify for a lower interest rate — which, over the course of a 30-year loan, can translate to big savings. Even a percentage point difference could save you thousands of dollars in the long run, so taking the time to repair or strengthen your credit today may be a well-placed effort.

Start Budgeting

If you don’t yet have a budget, the time before you purchase a home is a great time to start one. After all, homeownership usually comes with its own slate of expenses, from repairs to maintenance items and more, so ensuring you know where your money is going will help you prepare to meet those financial needs. (And, in the meantime, you may find some areas where you can make cuts that will make the upfront expenses, like your down payment, more feasible.)

Recommended: Refinance Your Mortgage and Save

Alternatives to Conventional Mortgage Loans

While conventional mortgages are the most common — and one of the most affordable options for those who qualify — there are different types of mortgage loans to consider. For example, as discussed, if you’re a first-time homebuyer, you may be able to qualify for an FHA loan from the Federal Housing Administration, which helps buyers qualify with lower credit scores than a conventional loan requires.

USDA and VA loans are also viable options for those looking in rural areas or who are (or are married to) service members or veterans.

Mortgage Tips

Need more mortgage help? Visit a home loan help center to study up on everything from amortization to escrow.

The Takeaway

While it takes a higher income to qualify for (and successfully pay off) a $700,000 loan, for many borrowers, it’s within reach — especially once you’ve found the right lender. Getting a mortgage doesn’t only depend on your income. There are multiple factors in play and learning the right mix could land you in a new home.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

How much income do I need for a $700K mortgage?

While there’s no one set income level that will automatically qualify you for a $700,000 mortgage, using the rule of thumb that your housing payment should be no more than a third of your gross monthly income, you’ll likely need somewhere between $180,000 and $200,000 per year to qualify, depending on other factors like your interest rate.

What is the monthly payment on a $700K mortgage?

Specific payment amounts depend on a wide range of factors including the interest rate you qualify for, the property taxes in your location, and the size of your down payment. In an example where you’re purchasing a $750,000 home with a $50,000 down payment at a 7.00% interest rate, your monthly payment would be close to $4,700 before insurance or taxes.

Can I afford a million-dollar home if I make $100K?

Again, how much money you make is only one factor that qualifies you for a mortgage — no matter its size. That said, because of the size of the monthly payment of a large mortgage, a $100,000 salary likely wouldn’t be enough to get you into a million-dollar home.

Photo credit: iStock/DMP

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
^†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.

SOHL-Q224-1843070-V1

If you earn at least $120,000 a year, you may be making enough to afford a $350,000 mortgage. But the amount lenders ultimately determine you can borrow will also depend on several other variables, including how much debt you have and your credit score.

Read on for a look at how much income may be needed to qualify for a $350,000 mortgage, how income fits into the overall mortgage equation, and how lenders typically decide how much mortgage a homebuyer can manage.

What Income Is Needed to Get a $350,000 Mortgage?

The home mortgage loan you can qualify for typically depends on how much the lender believes you can reliably pay back — and you can expect the loan company to run your financials through several different calculations to come up with that amount.

Home buyers tend to think the amount they’ll be approved for when they apply for a mortgage will be based mostly on their household income. But lenders may consider other important factors when deciding how much someone can borrow, including:

Reliability of Income

Yes, lenders will look at how much you earn to help determine if you can afford the monthly payments on the amount you hope to borrow. But they’ll also want to know how reliable that income is, so you may be asked how long you’ve had your job — or your business if you’re self-employed. Want to get an idea of where you stand before you apply for a mortgage? An online home affordability calculator can help you estimate if your income is high enough to afford a $350,000 loan.

Creditworthiness

Lenders also will check your credit score and credit reports to ensure you have a history of being financially responsible and paying your bills on time.

Down Payment Amount

Contrary to what many buyers believe, a 20% down payment isn’t required to get a home loan. First-time homebuyers may be able to put as little as 3% down — or even less, depending on the type of mortgage you plan to get. A larger down payment can help you lower your monthly payments, however. And it can show lenders that you’re serious about your investment.

Debt-to-Income (DTI) Ratio

You also can expect lenders to look at your existing monthly debts (credit cards, student loans, car payments, etc.) to assess whether you’ll be able to manage all those payments as well as a mortgage on your current income. The calculation used to compare your monthly debt payments with your monthly gross income is called your debt-to-income ratio (DTI = monthly debts ÷ gross monthly income).

What Is a Good Debt-to-Income Ratio?

The Consumer Financial Protection Bureau (CFPB) recommends that homeowners work toward maintaining a DTI ratio of 36% or less, and that’s the number mortgage lenders generally look for, as well. But some lenders may accept a DTI ratio of up to 43% — or even higher if the borrower can meet other criteria on certain types of loans.

What Other Factors Are Mortgage Lenders Looking For?

Besides your DTI, here are a few other basic formulas mortgage lenders — and you — may use to estimate how much you might be able to afford on your income.

The 28/36 Rule

The 28/36 rule combines two factors that lenders typically look at to determine how much mortgage you can afford: income and debt. The first number sets a limit of 28% of gross income as a home buyer’s maximum total mortgage payment, including principal, interest, taxes, and insurance. The second number limits the mortgage payment plus any other debts to no more than 36% of gross income.

For example: If your gross annual income is $120,000, that’s $10,000 per month. Using the 28/36 rule, that means you could aim for a monthly mortgage payment of about $2,800 — as long as your total monthly debt (including car payments, credit cards, etc.) isn’t more than $3,600.

The 35/45 Model

Another calculation lenders might look at is the 35/45 method, which recommends spending no more than 35% of your gross income on your mortgage and debt, and no more than 45% of your after-tax income on your mortgage and debt.

For example: Let’s say your gross monthly income is $10,000 and your after-tax income is about $8,000. In this scenario, you might spend around $3,500 to $3,600 per month on your debt payments and mortgage combined. This calculation allows for a larger mortgage payment if you aren’t carrying a lot of debt.

The 25% After-Tax Rule

If you’re nervous about keeping up with your payments, this method will give you a more conservative number to work with. With this calculation, your target is to spend no more than 25% of your after-tax income on your mortgage.

For example: If you make $8,000 a month after taxes, you might plan to spend $2,000 on your mortgage payments.

Keep in mind that these equations can only give you a rough idea of how much you’ll be able to borrow. When you want to be more certain about the overall price tag and monthly payments you can afford, it may help to go through the mortgage preapproval process.

What Determines How Much House You Can Afford?

Here’s something else to think about when determining how much income is needed for a $350,000 mortgage: A house payment generally isn’t limited to just principal and interest. And the extra costs that may be tacked on every month can add up fast. The costs covered by a monthly loan payment can include:

Principal

Principal is the original amount borrowed to buy the home. Each month, a portion of your payment will go toward paying down this amount.

Interest

Interest is the money you pay to the lender each month for giving you the loan. The interest rate you pay can be influenced by personal factors (such as the loan length you choose, your credit score, and your income) as well as general economic and market factors.

Homeowners Insurance

The cost of homeowners insurance (coverage that protects your home and other assets against various risks), also may be rolled into your monthly mortgage payment. Your lender will pay the premium when it’s due.

Mortgage Insurance

Depending on the type of loan you have and the amount you put down on your home, you may be required to carry private mortgage insurance (PMI) or some other type of mortgage insurance policy. This insurance is designed to protect the mortgage lender if a borrower can’t make the agreed upon loan payments.

Property Taxes

A portion of your monthly mortgage payment will also go toward the property taxes you’ll need to pay your local government.

Recommended: Home Loan Help Center

$350,000 Mortgage Breakdown Examples

The monthly payment on a $350,000 mortgage can vary based on several factors, including the length of the loan (usually 15, 20, or 30 years), the interest rate, and other costs. A mortgage calculator can help you get an idea of what your payments might look like. Here are some examples of how payments for a $350,000 mortgage might break down.

30-Year Loan at 6.00% Fixed Interest Rate

Total Payment: $2,801
Principal and Interest: $2,098
Other Costs (estimated PMI, homeowners insurance, and property taxes): $703

15-Year Loan at 6.00% Fixed Interest Rate

Total Payment: $3,657
Principal and Interest: $2,954
Other Costs (estimated PMI, homeowners insurance, and property taxes): $703

30-Year Loan at 7.00% Fixed Interest Rate

Total Payment: $3,032
Principal and Interest: $2,329
Other Costs (estimated PMI, homeowners insurance, and property taxes): $703

15-Year Loan at 7.00% Fixed Interest Rate

Total Payment: $3,849
Principal and Interest: $3,146
Other Costs (estimated PMI, homeowners insurance, and property taxes): $703

Pros and Cons of a $350,000 Mortgage

According to Redfin, the median sale price in the U.S. in April 2024 was $432,903 — which means finding a home with a $350,000 mortgage might be a challenge, depending on where you live. But if you can manage it — by searching for a lower-cost home or putting more money down — you could benefit from lower monthly payments. And depending on your income and other factors, it may be easier to qualify for a mortgage in this amount than for a larger loan.

Another plus: You’d be getting your foot in the door of homeownership, and that can mean building equity for the future.

Recommended: Best Affordable Places to Live in the U.S.

How Much Will You Need for a Down Payment?

A down payment typically ranges from 3% to 20% of the purchase price. The amount you’ll be required to put down may vary based on the type of mortgage loan you get.

Can You Buy a $350,000 Home with No Money Down?

You may be able to get a $350,000 mortgage with a 0% down payment if you can qualify for a government-backed loan from the U.S. Department of Veterans Affairs (VA) or the U.S. Department of Agriculture (USDA). These loans are insured by the federal government — which means the government will help pay back the lender if the borrower defaults on the loan.

Not all lenders offer these programs, and borrowers must meet specific requirements to qualify for a USDA or VA loan. But if you think you may be eligible, this could be an option that’s worth looking into.

Can You Buy a $350,000 Home with a Small Down Payment?

Some private lenders will accept as little as 3% down on a conventional loan — so don’t feel as though you have to come up with 20% down before you can pursue homeownership. You might want to check out the requirements for a government-backed FHA loan, which also allows borrowers to make a small down payment. Or you may be able to find a state or local program that offers down-payment assistance.

Is a $350,000 Mortgage with No Down Payment a Good Idea?

Coming up with even a small down payment can be a hurdle when it comes to homeownership — especially for first-time homebuyers — and the thought of skipping that step can be appealing. Avoiding a down payment may help you get into a home faster or allow you to hold onto your savings for renovations, an emergency fund, or other financial goals.

It’s important to keep in mind, though, that without a down payment it can take longer to build up equity in your home. And because you’re borrowing more money, you also could end up paying more interest over the life of the loan. Also, although you won’t have to pay for mortgage insurance with a no-down-payment government-backed loan, you can expect to pay an upfront funding fee for a VA loan and an upfront and annual guarantee fee for a USDA mortgage.

A mortgage professional can help you evaluate the different types of mortgage loans and determine the best move for your individual circumstances.

What I\if You Can’t Afford a $350,000 Mortgage Even With No Down Payment?

Here are a few steps to consider if it turns out you can’t afford the payments on a $350,000 mortgage:

Pay Off Debt

If your DTI ratio needs work, you may want to press pause on your home search and focus on paying down recurring debts like credit cards, car payments, or a personal loan. This could allow you to put more of your monthly income toward your mortgage payments.

Build Up Your Credit

Checking your credit reports can give you an idea of what lenders might see when they evaluate your credit. If there are any errors, you can take steps to get them fixed. And if you see something negative in your reports, you can work on doing better. If you use a credit-score monitoring service, you may already know what your credit score is and if it needs a boost. Conventional lenders typically look for a minimum score of 620 to 640.

Start Budgeting

Creating a budget and trimming some expenses could help you reach your debt-payment and savings goals. Remember: If you can come up with a bigger down payment, you may be able to borrow less and keep your monthly payments to a more reasonable amount.

Alternatives to Conventional Mortgage Loans

If you can’t qualify for a conventional mortgage loan, you may have some alternatives to consider. Here are a few potential options:

Look into First-time Homebuyer Programs

As mentioned above, you may qualify for a federal, state, or local first-time homebuyer program that can help lower your down payment, closing costs, and other expenses. There may be limits on the type of home you can buy or a cap on the home’s cost. But you might find it’s worth doing some research, or asking a mortgage professional, to see if you’re eligible and could benefit.

Rent-to-Own

Another option may be to enter into an agreement to rent-to-own a home. With this type of arrangement, you start out renting, but the landlord agrees to credit a portion of your monthly payment toward purchasing the home. This can be a good way to start working toward homeownership if you can’t qualify for a mortgage. But it’s important to understand the downsides of the deal — including that you might lose money if you change your mind about buying the home, or if the landlord has second thoughts about selling.

Owner Financing

With owner financing, the person who’s selling the home may serve as the lender for all or part of the purchase price. Just as with a rent-to-own home, there are risks to this kind of agreement, but it can make homeownership possible if a traditional loan isn’t available.

Mortgage Tips

No matter how much you plan to borrow, buying a home is a big step. Here are a few things you may want to do to prepare:

Work Out Your Housing Budget

Remember, your housing costs won’t be limited to principal and interest. It’s important to determine how much you might pay for insurance, taxes, HOA dues, maintenance, and other expenses before you make the leap to homeownership.

Find the Mortgage That Best Suits Your Needs

This may include deciding whether you want a:

•   fixed vs. variable interest rate

•   conventional vs. government-backed loan

•   shorter vs. longer term loan

Get Preapproved

Going through the mortgage preapproval process with a lender can give you a better idea of how much you can afford to spend on a home. And having preapproval may give you an edge over other house hunters in a tight market.

The Takeaway

Obtaining a mortgage is just one of many steps in the homebuying process, but it’s important to get it right. Taking the time to do some research and to think about the total picture of your finances and monthly expenses could keep you from getting in over your head — or locked into a loan that isn’t a good fit.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

How much income do you need to qualify for a $350,000 mortgage?

If you make at least $120,000 a year, you may be able to manage the payments on a $350,000 mortgage, depending on how much debt you’re carrying and other variables.

Can I afford a $350,000 house on a $70,000 salary?

If you have enough saved for a large down payment and/or you’re carrying little or no debt, you might be able to afford a $350,000 house on a $70,000 salary, but it could be an uncomfortable squeeze to make the monthly payments.

Can I afford a $350,000 house on a $60,000 salary?

If you can afford a very large down payment, you may be able to afford a $350,000 house on a $60,000 salary, but without other sources of income beyond your salary, getting a mortgage and keeping up with your monthly payments could be difficult.

Photo credit: iStock/zamrznutitonovi

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
^†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.

SOHL-Q224-1906790-V1

Claiming unclaimed money from a deceased relative can be fairly straightforward — or more complicated — depending on state inheritance laws and the amount of supporting evidence to back the claim.

When a person dies without a will or other legally binding document outlining the distribution of their financial assets, that money may become “unclaimed” after a designated period of time. Unclaimed money is often turned over to the state where that person lived. However, it is possible for relatives to claim that money through the appropriate channels.

What Happens to Unclaimed Money from Deceased Relatives?

When no direct heir is identified, unclaimed money and assets from a deceased relative go to the state government. How soon the money goes to the state after the person dies will vary according to that state’s inheritance laws.

Once unclaimed money ends up in the hands of the government, the state authority will try to identify any relatives that are entitled to claim the money. Typically, a description of the assets and the name of the deceased are posted to one or several public and searchable websites. Some examples of these websites are:

•  Unclaimed.org

•  MissingMoney.com

•  TreasuryDirect.gov

•  FDIC.gov and NCUA.gov

•  PBGC.gov

•  UnclaimedRetirementBenefits.com

•  ACLI.com

Can You Claim Unclaimed Money From a Deceased Relative?

If you believe you are entitled to an unclaimed financial asset of a deceased relative, you can file a claim with the state government or business that is holding it. If you are specifically named as a beneficiary in the deceased relative’s will, the claim process can be relatively smooth. If not, you may still be able to claim that money but it will require supporting documentation or potentially a decision from a presiding probate court judge to ultimately verify the claim.

Recommended: How Much Does It Cost to Make a Will?

What Types of Financial Assets Can Be Claimed from Deceased Relatives?

Unclaimed money doesn’t necessarily have to be in the form of cash; it can also include other assets of value such as:

•  Real estate

•  Forgotten bank accounts

•  Bonds

•  Stocks

•  Certificates of deposit

•  Annuities

•  Royalties

•  401(k)s and other retirement plans

•  Vehicles and other physical assets

Recommended: Unclaimed Money from Scholarships and Grants

What to Expect From the Unclaimed Money Process

If you’re planning to claim unclaimed money, the process will vary depending on the state you’re filing in and the asset in question. In some cases, you can file a claim online, provide proof of identity and any documented proof of ownership, and wait for your claim to be processed. Once the claim is approved, you receive the money. A budget planner can help you make the most of any unclaimed money you receive and also provide valuable financial insights.

In situations where the deceased did not have a will or an executor for the will, a probate court will typically appoint someone to oversee any ownership claims and asset transfers. If this is the case, you may have to wait longer or provide more documented proof in court before your claim is approved.

Once your claim is approved and you receive the money owed to you, you may be required to pay inheritance tax. Again, this depends on which state the deceased lived in. However, spouses are exempt from paying inheritance tax in every state.

The Takeaway

Claiming unclaimed money from a deceased relative is entirely possible. However, the complexity of the process will ultimately depend on the circumstances and location of the deceased. If you believe you’re entitled to claim unclaimed money from a deceased relative, leveraging an estate planning attorney or a financial advisor can help demystify the process and any specifics about your claim. Bottom line: It’s never too early to start thinking about your own estate planning needs and long-term financial goals.

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FAQ

How do you know if a deceased loved one has left you money?

If a deceased relative has named you as a beneficiary in their will or another legally binding contract, the executor of that document or a probate court will likely reach out to inform you of any unclaimed money you are entitled to. If not, you can still check to see if you are entitled to money by searching one of the public online unclaimed-money databases or by reaching out to the deceased relative’s financial advisor or estate planner.

How do I find assets of a deceased person?

To find the assets of a deceased relative, try looking through their personal property, reach out to relatives and other friends with knowledge of their financial affairs, or inquire with the local probate court or state government agencies.

What happens when you inherit money?

Depending on where you inherit money, you may be required to pay inheritance tax. After that, you are free to do with the money as you please. However, it is often advisable to think hard about how to use that money to support your financial needs or long-term goals.

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SORL-Q224-1921044-V1

The average cost of the CPA exam is about $2,000, but the exact cost varies for each candidate. The biggest reason for this is that each state has its own board of accountancy, each of which sets its own costs for several items that are needed to sit for the exam.

There are also necessary costs that aren’t tied to the exam itself, such as licensing fees and continuing education costs. If you have to retake or reschedule the exam, you may have to repay registration and examination fees. Plus, the single most expensive part of the process tends to be the review course, the price of which can vary widely.

Passing the CPA exam can be expensive. Fortunately, there are many ways to cover the costs, and the price can be well worth it if you pass the exam.

How Much Does It Cost to Take the CPA Exam?

As just noted, the cost to take the CPA exam is about $2,000, but the final estimate will vary depending upon where you live. Hence, you could end up paying several hundred dollars above or below this amount. However, while the total cost can vary significantly, there are certain items that are common expenses for all exam candidates.

This is a wide range, but that is expected given that the costs can be different from one state to the next. Examination fees shown above are approximate; your state’s fees may be higher or lower.

In addition, the CPA review courses sometimes have tiered pricing, so even two people taking the same course and living in the same state may have different costs. There can be several differences between different tiers of review courses, such as 24-month access versus lifetime access.

Do You Need a Finance Degree to Take the CPA Exam?

Each of the 55 licensing jurisdictions (all 50 states, plus Washington, DC, Guam, Puerto Rico, the Virgin Islands, and the Mariana Islands) maintains its own licensing requirements. Because of this, each state may have slightly different requirements to sit for the exam.

All 50 states require a bachelor’s degree plus 150 credit hours in order to become a licensed CPA. However, rather than requiring a finance (or accounting) degree, states may require 120 credit hours of college credits plus 30 additional, accounting-specific credit hours to sit for the exam.

Still, you should review your state’s requirements before you begin preparing for the exam. Some states require 30 hours of accounting courses, while others require upper-level accounting courses. Your state or territory’s board of accounting website will list the specific requirements needed to sit for the exam.

Recommended: What Can You Do With a Finance Degree and What Is the Cost?

Other CPA Exam Costs

There isn’t just one fee to sit for the CPA exam; candidates must cover several costs, all of which vary depending upon where you live. This is one of the reasons the cost can be quite different from one state to the next.

Ethics Exam

Your state may require you to take and pass an ethics exam in order to practice there. Some states have their own ethics exams, while others administer the AICPA exam. Currently, the AICPA exam costs $250 – $320 and can vary depending on the course option you select.

Registration Fees

Most states require a registration fee for each of the four exam sections. Fees vary but are generally $75 to $100 per section. Some states also have tiered pricing for registration, allowing you to save money if you register for multiple sections at once. If you choose to register for multiple sections at once, keep in mind that each section is estimated to take four hours, with a total of 16 hours for the entire exam.

Application Fees

Application fees are due when you apply to take the CPA exam. Because each state sets its own fees, these vary but are usually between $100 and $200. The fee is non-refundable, but you usually don’t have to pay the application fee again if you have to retake the exam. However, if your application is rejected, you may have to pay the fee more than once.

CPA Licensure

The CPA licensure fee is only necessary after you pass the exam. This is the fee you pay to your state accountancy board to be a licensed accountant. These fees also vary by state and can run anywhere from $50 to $500. This cost is an annual one, so you should expect to pay the fee every year to maintain your license.

Keep in mind that each state has its own licensing requirements and accountancy board. Hence, if you move out of state, you will have to be licensed in the new state to be recognized as a CPA there.

Background Check

Your state may require you to pass a background check as part of the licensing process. According to NASBA, the fee ranges anywhere from $1 to $49. In the case of California, there is an additional “rolling” fee of $15 for fingerprinting.

Travel and Accommodations

Currently, the CPA exam cannot be taken online; it can only be administered at Prometric Testing Centers. You can find a testing center with Prometric’s Pro Scheduler . Testing centers are only located in select cities, so you may end up spending hundreds of dollars on transportation and accommodations depending on how close you are to a testing center.

International Candidate Credential

If you want to take the exam outside the United States, you may be required to pay additional fees for international candidate credentialing. Most states allow international applicants to sit for the exam, but six states and two territories do not administer it. In addition to any domestic fees, you may also have to pay additional fees of $371.55 for each of the following: Auditing and Attestation (AUD), Business Environment and Concepts (BEC), Financial Accounting, and Reporting (FAR), and Regulation (REG).

Covering CPA Exam Costs

Although the exact cost of the CPA can vary significantly, one thing is for certain: the exam and licensing process is expensive. Fortunately, there are many ways to cover the costs.

Private Student Loan

A private student loan can help you cover some or all of the cost of the CPA exam. For example, SoFi student loans have no fees, come with multiple repayment options, and have low fixed and variable rates. Everything is handled online and the application process is simple.

Private student loans are different from federal student loans. Federal student loans may have more consumer protection, but private student loans may offer more competitive interest rates. Consider both private and federal student loans if you need to finance your CPA exam costs.

Credit Card

You may be able to pay for some or all of your costs with a credit card. In fact, if paying online, payment by credit card may be required for examination fees. The same may be true for application and registration fees.

Exam prep courses are offered by third parties, so you should be able to pay for them with a credit card in most cases.

Personal Savings

Avoid tapping into your emergency fund, but any excess savings can help cover exam costs. If you aren’t able to pay for the entire cost with personal savings, scholarships, grants, and student loans can help you pick up the tab. But personal savings can also be useful, particularly if you still owe money after considering other options.

Scholarships

There are several scholarships available that can help you cover much of the cost of the CPA exam. For instance, the American Institute of Certified Public Accountants offers a scholarship of up to $1,000 to exam candidates. Another example is the Newt D. Becker scholarship, worth up to $2,499.

Your state board may also offer scholarships; for example, Wisconsin offers several $2,500 college scholarships to go toward your 150 hours required to sit for the exam. Check with your state board to see if the state offers any additional scholarships.

Employer Reimbursement

Some employers will reimburse you for the cost of the exam itself, review materials, or both. If you work for an accounting firm and the exam is relevant to your job, it’s a good idea to ask whether your employer reimburses these costs.

The Takeaway

There are many costs associated with CPA licensure, from prerequisite coursework all the way to maintaining your license each year. Each of the 55 licensing jurisdictions has its own requirements and fees, so where you live can affect not only licensing requirements but also the cost of the whole process.

However, what is for sure is that becoming a licensed CPA isn’t cheap. The price tag is likely to be four figures, which is high, especially before you are certified.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

How much does the CPA exam cost to take?

The cost is about $2,000 on average, but the exact cost depends upon where you live. Each state sets its own fees, so they may vary significantly from one state to the other. Also, exam prep courses can add to the overall cost.

Are there any hidden costs to take a CPA exam?

Hopefully, there will not be any hidden costs of the CPA exam if you have considered all of the costs mentioned here. However, there may be some fees you don’t anticipate. For example, if you have to retake or reschedule the exam, you may have to repay the registration fee in addition to repaying fees per exam section.

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