How to Buy a House in West Virginia: 6 Steps

Purchasing a house is a major financial decision that requires planning. In West Virginia, the average home value is $169,446, which is significantly lower than the national average of $362,481. This lower cost can make West Virginia an attractive option for those looking for affordability.

Understanding down payment assistance programs, mortgage types and state-specific regulations and requirements can ensure a smooth journey toward homeownership in the Mountain State. MoneyGeek has compiled pointers to help you navigate the homebuying process in West Virginia, from saving the down payment and choosing the ideal location to finding the best financing option for your particular needs and credit history.

According to the U.S. Census Bureau, the homeowner vacancy rate in West Virginia in the second quarter of 2024 was 0.9%. The homeowner vacancy rate measures the percentage of homes available for sale compared to the total number of homeowner-occupied units.

The stable homeowner vacancy rate is around 2%. With West Virginia's rate, there is insufficient inventory to satisfy homebuyer demand. This tight market condition means potential homebuyers may face challenges finding available homes and bidding situations.

Before buying a house in West Virginia, look at your financial and credit history. A strong financial profile improves your chances of getting approved when applying for a mortgage. Lenders assess it to determine your ability to repay the loan.

Your credit score influences the mortgage loans and interest rates you qualify for. A higher score increases your chances of securing a reasonable rate. According to Experian, the average credit score in West Virginia in the third quarter of 2023 was 703.

If your credit score falls below 580, or poor on the FICO scale, buying a house is still possible, though mortgage approval may be challenging. Check the table below for the ideal mortgage type based on the minimum credit score requirements.

Source: Experian

Your debt-to-income ratio (DTI) is critical for lenders to determine how much of your monthly income is allocated to debt payments and how much mortgage debt you can manage responsibly. In the third quarter of 2023, the average mortgage debt in West Virginia was $129,889, according to Experian. This figure underscores the financial responsibility of taking on a mortgage.

Monthly debt payments included in your DTI are credit card bills, student loans, car loans and housing expenses. Use our debt-to-income ratio calculator below to determine your front-end DTI, which is your housing expenses, and your back-end DTI, which includes all monthly debts.

Purchasing a home that stretches your finances too thin can lead to significant financial strain. To avoid this pitfall, consider the 28% rule, which suggests keeping your monthly mortgage payment at or below 28% of your gross monthly income.

According to the U.S. Bureau of Labor Statistics, the median annual income in West Virginia as of April 2024 was $39,770, or a gross monthly income of $3,314 before taxes. Applying the 28% rule means your monthly payment should not exceed $928. This calculation provides a realistic benchmark for potential homebuyers in the state, helping them make informed decisions about their housing budget.

Use our mortgage calculator below to estimate your monthly mortgage payment in West Virginia and see how it aligns with your financial situation.

A down payment is the portion of the total purchase paid upfront. A 20% down payment is the standard, but this can be a hurdle for many homebuyers. For instance, in West Virginia, the average home value is $169,446, making a 20% down payment of $33,889. For homes above the average value, like those priced at $195,000, the down payment would be $39,000.

Fortunately, saving up for a 20% down payment is not mandatory. Many mortgage types allow for lower down payments. Government-backed loans such as VA loans require no down payment, while FHA loans require as little as 3.5%.

If you choose to put down less than 20%, your lender may require you to take out private mortgage insurance. Our PMI calculator can estimate your monthly premium based on credit score and down payment.

West Virginia offers several down payment assistance programs that make homeownership possible. By reducing the initial cost barrier, more people can achieve their dream of owning a home.

Please refer to the table below for more information on the available down payment assistance programs from the West Virginia Housing Development Fund (WVHDF).

Finding the right location in West Virginia involves considering the average house price in your areas of interest, your proximity to family, friends, work or school and access to amenities such as public transportation, parks, restaurants and shopping centers.

The cost of living also impacts your choice of a new home. According to the Missouri Economic Research and Information Center (MERIC), West Virginia's cost of living index for the first quarter of 2024 was 83.8, below the national average of 100. Consider these essential expenses when choosing a location:

• Food
• Health care
• Clothing
• Utilities
• Education
• Transportation
• Entertainment

Check out the table below to see the average home values of some cities in West Virginia based on recent data. You can also use our cost of living calculator to help estimate how much you'll need to pay for all the essentials in different locations.

Source: Zillow

Working with a real estate agent can accelerate your house hunt in West Virginia. They offer the guidance you need, handle the paperwork, provide an expanded list of property options and recommend other service providers like title companies and inspectors to assist you.

When finding a real estate agent, do your due diligence and interview agents experienced in the neighborhoods you're interested in. Consider the following tips:

• Find someone compatible with your needs and personality
• Verify the agent's credentials, training and licensure
• Ensure they have in-depth knowledge of the area
• Shop around for agents and compare their rates

You can also use the license holder search tool from the West Virginia Real Estate Commission to find or verify real estate agents.

Homebuying requires you to find a mortgage that fits your budget. In West Virginia, options include conventional, jumbo, FHA, VA and USDA loans. You can select terms ranging from 10 to 30 years and decide between a fixed-rate mortgage or an adjustable-rate mortgage (ARM). Choosing the right financing option can enhance your approval odds and lead to long-term savings.

Interest rates on a mortgage can fluctuate daily due to factors such as the type of mortgage, the lender and the economy. While the interest rate is the cost of borrowing, expressed as a percentage of the loan amount, the APR includes the interest rate and other costs associated with the loan. This makes the APR a more comprehensive measure of the actual cost of borrowing.

As of October 2024, the APR for a 30-year fixed conforming loan in West Virginia is 6.50%, while the APR for a 30-year fixed-rate FHA loan is 7.45%. Please check the table below to see the current mortgage rates in West Virginia by mortgage type.

In West Virginia, obtaining a mortgage pre-approval is a strategic step. It allows lenders to assess your financial status and determine the loan amount you qualify for. The lender issues a mortgage pre-approval letter, typically valid for 60 to 90 days, to demonstrate to sellers that you are a serious buyer with financial backing. It can enhance your credibility in a competitive market.

To secure a mortgage pre-approval, you will need to submit several documents, including:

• Proof of income, such as pay stubs or tax returns
• Credit history report
• Bank statements and other asset documentation
• Identification documents, like a driver's license or passport
• Debt information, including credit card and loan statements

While both mortgage pre-approval and prequalification provide insights into your borrowing potential, they differ in depth and reliability. Prequalification is based on self-reported financial information. In contrast, pre-approval involves a more thorough review of your financial documents and credit history.

Home inspections help uncover potential issues that may not be visible during a casual viewing. Inspectors typically examine structural components, electrical systems, plumbing, roofing and HVAC systems. An inspection report details the condition of these areas and highlights any necessary repairs.

This information can be pivotal in making a purchasing decision. For instance, an inspection might reveal major issues such as a failing roof or outdated electrical wiring. These findings can significantly impact the home's appraisal, potentially lowering its value. In such cases, buyers might decide to rescind their offer, especially if the cost of repairs is prohibitive.

The West Virginia State Fire Marshal's Office regulates the state's home inspection regulations. Licensed home inspectors must adhere to established standards of practice and obtain and maintain liability insurance.

If you're looking for a home inspector in West Virginia, ensure they hold a valid license, read reviews and ask for references. You can also verify or find licensed home inspectors using the Office of the State Fire Marshal's list of West Virginia home inspectors.

Home appraisals provide an unbiased estimate of a property's market value, which is essential for buyers and lenders. According to the 2023 Appraisal Survey from the National Association of Realtors (NAR), the median appraisal cost in 2023 was $500.

While inspections and appraisals are conducted during the homebuying process, an appraisal determines the property's market value, whereas an inspection assesses its physical condition. Lenders require appraisals to ensure the loan amount aligns with the property's market value.

Closing is the final step of buying a house in West Virginia, where the final transfer of ownership occurs and you receive the keys to the property. Your lender must provide a closing disclosure document three days before the official closing. This document includes loan terms, projected monthly payments, fees and other closing costs. Plan a final walk-through of the property with your real estate agent near closing day to ensure it's still in the expected condition.

On closing day, you'll review and complete several documents that finalize your home purchase. You'll need to sign the following:

• Final loan application: This document confirms the loan terms you've agreed to with your lender. It ensures that both parties are on the same page regarding the loan's specifics.
• Deed transfer: This legal document officially transfers property ownership from the seller to you. It's a critical step in becoming the legal owner of your new home.
• Promissory mortgage note: This note is your written promise to repay the loan amount. It outlines the repayment terms and conditions agreed upon with your lender.
• Homeowners insurance: Protecting your new home is vital, and homeowners insurance in West Virginia can help safeguard it against damages and liabilities specific to the region.

Closing costs are fees incurred during the finalization of a real estate transaction. In West Virginia, the average closing cost is $2,124, according to NAR. This cost encompasses the following:

• Appraisal fee: This fee covers the cost of a professional evaluation of the property's market value.
• Title search and insurance fee: This involves verifying the property's title history and securing insurance to protect against future claims.
• Escrow deposit: Funds held by a third party to cover property taxes and insurance premiums.
• Prepaid costs: These are upfront payments for future expenses, such as homeowners insurance and property taxes.
• Other closing costs: Additional fees may include attorney, recording and credit report fees.

Learning about the different first-time homebuyer programs in West Virginia can help you achieve homeownership faster. These programs offer various benefits that could make the process more efficient and accessible.

We answered some frequently asked questions about buying a house in West Virginia to kickstart your homebuyer journey.