South Carolina Home Buying Guide
Your Complete Step-by-Step Guide to Purchasing a Home in the Palmetto State
Step 1: Assess Your Financial Readiness
1Check Your Credit Score
Your credit score significantly impacts your mortgage rate and loan approval. In South Carolina, most conventional loans require a minimum score of 620, though FHA loans may accept scores as low as 580.
💡 Tip: Get a free credit report from AnnualCreditReport.com. Review for errors and dispute any inaccuracies at least 3-6 months before applying for a mortgage.
2Calculate Your Budget
Determine how much house you can afford using the following guidelines:
- 28/36 Rule: Housing costs should not exceed 28% of gross monthly income; total debt should not exceed 36%
- Down Payment: Aim for 20% to avoid PMI, but SC offers programs with as little as 3% down
- Emergency Fund: Maintain 3-6 months of expenses after purchase
Estimated Costs for a $300,000 Home in South Carolina
| Expense | Estimated Cost |
|---|---|
| Down Payment (20%) | $60,000 |
| Closing Costs (2-5%) | $6,000 - $15,000 |
| Home Inspection | $400 - $600 |
| Appraisal | $400 - $600 |
| Moving Costs | $1,000 - $3,000 |
| Initial Repairs/Furnishings | $2,000 - $5,000 |
| Total Initial Cash Needed | $69,800 - $84,200 |
3Get Pre-Approved for a Mortgage
Pre-approval shows sellers you're a serious buyer and helps you understand your purchasing power.
Documents Needed:
- 2 years of tax returns
- 2 recent pay stubs
- 2 months of bank statements
- Photo ID
- Proof of other assets (investments, retirement accounts)
- List of current debts
Step 2: Explore South Carolina First-Time Buyer Programs
SC State Housing Finance & Development Authority Programs
Palmetto Heroes Program
Who Qualifies: Teachers, firefighters, law enforcement, EMTs, healthcare workers, military (active/veteran), and child protective services employees
Benefits:
- Up to $15,000 in down payment assistance
- Can be forgiven after 15 years of occupancy
- Below-market interest rates
Mortgage Credit Certificate (MCC)
Benefit: Converts up to $2,000 of mortgage interest into a federal tax credit annually
Who Qualifies: First-time buyers (or haven't owned in 3 years) with income limits varying by county
House Keys 4 Employees Program
For: Employees of participating South Carolina employers
Benefits: Down payment assistance and reduced interest rates
⚠️ Important: Income and purchase price limits apply to all programs and vary by county. Check with SC Housing at schousing.com for current limits in your area.
Other Financing Options
- FHA Loans: 3.5% down payment, credit scores as low as 580
- VA Loans: $0 down for eligible veterans and service members
- USDA Loans: $0 down for eligible rural areas (covers many SC locations)
- Conventional 97: 3% down payment for first-time buyers
Step 3: Find the Right Real Estate Agent
A good agent familiar with South Carolina's market is invaluable. Look for someone who:
- Has experience in your target area
- Understands SC-specific issues (flood zones, hurricanes, historic preservation)
- Is responsive and communicative
- Has strong negotiation skills
- Provides references from recent buyers
💡 Tip: Interview at least 3 agents before deciding. Ask about their average days on market, percentage of list price achieved, and how many transactions they complete annually.
Step 4: Start House Hunting
Create Your Must-Have List
Separate your needs from wants:
Essential Criteria (Must-Haves)
Number of bedrooms/bathrooms
Location/commute requirements
School district quality
Maximum price range
Home type (single-family, townhome, condo)
Desirable Features (Nice-to-Haves)
Updated kitchen/bathrooms
Garage
Yard size
Specific architectural style
Pool or HOA amenities
South Carolina-Specific Considerations
Flood Zones: SC has extensive flood-prone areas. Always check FEMA flood maps. Properties in high-risk zones require flood insurance, which can cost $400-$3,000+ annually.
- Hurricane Preparedness: Coastal homes should have storm shutters or impact-resistant windows
- Termites: Common in SC. Ensure termite inspection and consider termite bonds
- Wells and Septic: Common in rural areas; require specific inspections
- Historic Restrictions: Historic districts have renovation limitations
- HOA Rules: Review covenants carefully, especially in planned communities
Step 5: Make an Offer
Components of a Strong Offer
- Purchase Price: Based on comparable sales and market conditions
- Earnest Money Deposit: Typically 1-3% of purchase price in SC
- Contingencies: Financing, inspection, appraisal, and possibly home sale
- Closing Date: Usually 30-45 days from acceptance
- Inclusions: Specify appliances, fixtures, or other items
💡 SC Market Tip: In competitive markets (Charleston, Greenville, Columbia suburbs), be prepared to move quickly. Some sellers receive multiple offers within hours of listing.
Standard Contingencies in South Carolina
- Financing Contingency: Protects you if you can't obtain a loan (typically 30 days)
- Inspection Contingency: Allows you to negotiate repairs or withdraw (typically 10-15 days)
- Appraisal Contingency: Protects you if home doesn't appraise at purchase price
- Due Diligence Period: Time to review HOA docs, surveys, and other materials
Step 6: Home Inspection
A thorough inspection is critical in South Carolina due to climate-related issues.
Essential Inspections
| Inspection Type | Cost Range | When Needed |
|---|---|---|
| General Home Inspection | $400-$600 | Always required |
| Termite/Wood Destroying Insects | $75-$150 | Always in SC |
| Roof Inspection | $200-$400 | If roof is 10+ years old |
| HVAC Inspection | $150-$300 | If system is older |
| Septic Inspection | $300-$600 | If home has septic system |
| Well Water Testing | $200-$400 | If home has well water |
| Mold Inspection | $300-$700 | If moisture concerns |
| Foundation Inspection | $400-$800 | If concerns identified |
⚠️ SC-Specific Concerns: Pay special attention to moisture issues, wood rot, HVAC capacity (SC heat requires robust cooling), and hurricane damage history.
What to Do After Inspection
You have several options if issues are found:
- Request Repairs: Ask seller to fix specific items before closing
- Request Credit: Ask for money at closing to address repairs yourself
- Request Price Reduction: Lower purchase price to account for needed work
- Walk Away: If major issues exist, you can terminate during contingency period
Step 7: Secure Your Mortgage
Mortgage Shopping Tips
- Compare rates from at least 3 lenders (banks, credit unions, online lenders)
- Look beyond interest rates—compare APR, closing costs, and loan terms
- Consider points (upfront cost to lower interest rate)
- Lock your rate once you're under contract
Common Mortgage Types in South Carolina
| Loan Type | Best For | Down Payment | Key Features |
|---|---|---|---|
| Conventional | Good credit, stable income | 3-20% | PMI if less than 20% down |
| FHA | Lower credit scores, first-time buyers | 3.5% | Upfront and monthly MIP |
| VA | Veterans, active military | 0% | No PMI, funding fee applies |
| USDA | Rural properties, income limits | 0% | Income and location restrictions |
| Jumbo | High-value properties | 10-20% | Stricter requirements |
Underwriting Process
After applying, your lender will verify:
- Employment and income
- Assets and down payment source
- Credit history
- Property appraisal
- Title search results
⚠️ During Underwriting—DO NOT:
- Change jobs or employment status
- Make large purchases or open new credit accounts
- Miss any bill payments
- Transfer money between accounts without documentation
- Co-sign loans for others
Step 8: Review Title and Purchase Insurance
Title Search and Insurance
In South Carolina, title searches ensure the property has a clear title with no liens or ownership disputes.
- Title Search Cost: Typically included in title insurance premium
- Owner's Title Insurance: Protects your ownership rights (one-time fee at closing, typically $500-$1,500)
- Lender's Title Insurance: Required by mortgage lenders (you pay, it protects lender)
Homeowner's Insurance
Required before closing. South Carolina factors to consider:
- Wind/Hurricane Coverage: Essential for coastal properties, may require separate policy
- Flood Insurance: Required if in flood zone, recommended for all SC properties
- Replacement Cost vs. Actual Cash Value: Choose replacement cost coverage
- Liability Coverage: Minimum $300,000 recommended
Average Annual Insurance Costs in South Carolina
| Coverage Type | Average Annual Cost |
|---|---|
| Standard Homeowner's Insurance | $1,500 - $2,500 |
| Coastal/Wind Coverage (additional) | $1,000 - $5,000+ |
| Flood Insurance | $400 - $3,000+ |
| Umbrella Policy (optional) | $200 - $500 |
Step 9: Final Walk-Through
Schedule this 24-48 hours before closing to verify:
Final Walk-Through Checklist
All negotiated repairs have been completed
No new damage since inspection
All included appliances and fixtures are present
Utilities are on for testing
Garage door openers and keys are available
Home is in broom-clean condition
No personal property remains (unless agreed)
All systems work properly (HVAC, plumbing, electrical)
Step 10: Closing Day
Before Closing
You'll receive a Closing Disclosure at least 3 business days before closing. Review carefully and compare to your Loan Estimate. Verify all numbers are correct.
What to Bring to Closing
Government-issued photo ID
Cashier's check or proof of wire transfer for closing costs
Proof of homeowner's insurance
Copy of your Closing Disclosure
Personal checkbook (for minor adjustments)
Documents You'll Sign
- Promissory Note: Your promise to repay the loan
- Mortgage/Deed of Trust: Secures the loan with the property
- Closing Disclosure: Final accounting of all costs
- Deed: Transfers ownership to you
- Affidavits: Various legal statements
Typical Closing Costs in South Carolina (2-5% of Purchase Price)
| Fee Category | Approximate Cost |
|---|---|
| Loan Origination Fee | 0.5-1% of loan amount |
| Appraisal | $400-$600 |
| Credit Report | $25-$50 |
| Title Search & Insurance | $500-$1,500 |
| Attorney Fees (SC requires attorney closing) | $500-$1,000 |
| Recording Fees | $50-$150 |
| Survey | $300-$500 |
| Property Taxes (prorated) | Varies by property |
| Prepaid Homeowner's Insurance | First year premium |
| HOA Transfer/Setup Fees | $200-$500 (if applicable) |
⚠️ South Carolina Requirement: All real estate closings in SC must be conducted by a licensed attorney. Your lender typically coordinates with the closing attorney.
After Closing: New Homeowner To-Do List
Immediately After Closing
Change all locks and garage codes
Transfer utilities to your name
Update your address (USPS, DMV, banks, employer)
Set up homeowner's insurance automatic payments
Locate and test main water shutoff and electrical panel
Review property tax payment schedule
First 30 Days
File Homestead Exemption (can reduce property taxes)
Change HVAC filters
Schedule termite inspection/treatment if needed
Test smoke detectors and carbon monoxide alarms
Create home maintenance schedule
Save all closing documents in safe place
South Carolina Homestead Exemption
SC offers property tax exemptions for owner-occupied homes. File with your county auditor's office within one year of purchase.
- Standard Exemption: First $50,000 of value exempt from school operating taxes
- 4% Assessment Cap: Property value increases capped at 15% in 5 years for owner-occupied
- Senior Citizens (65+): Additional exemptions up to $50,000
- Disabled/Blind: May qualify for full exemption
South Carolina Property Taxes
Understanding SC's unique property tax system:
How SC Property Taxes Work
- Assessment Rate: Owner-occupied homes are assessed at 4% of market value
- Millage Rate: Varies by county and municipality (typically 200-400 mills total)
- Payment Schedule: Due dates vary by county (typically January-March)
- First-Year Prorations: Handled at closing based on sale date
Example Property Tax Calculation
Home Market Value: $300,000
Assessment (4%): $12,000
Less Homestead Exemption: -$2,000 (example)
Taxable Value: $10,000
Millage Rate (300 mills): × 0.300
Annual Property Tax: $3,000
Ongoing Home Maintenance Budget
Plan for these annual costs beyond your mortgage:
| Expense Category | Annual Estimate |
|---|---|
| Property Taxes | $2,000 - $6,000+ |
| Homeowner's Insurance | $1,500 - $2,500+ |
| HOA Fees (if applicable) | $200 - $2,000+ |
| Utilities (electric, water, gas) | $2,400 - $4,800 |
| Maintenance & Repairs (1% of home value) | $3,000+ |
| Lawn Care/Landscaping | $500 - $2,000 |
| Pest Control (important in SC) | $300 - $600 |
| HVAC Maintenance | $200 - $400 |