SAN FRANCISCO — Many aspiring first-time homebuyers believe they are well-prepared to purchase a home, but a new survey by Wells Fargo suggests most lack a basic understanding of key mortgage and homebuying concepts.
According to Wells Fargo’s 2026 Home Lending Quiz, conducted by Ipsos, nearly seven in 10 prospective first-time homebuyers described themselves as knowledgeable about the homebuying process. However, the survey found that 75% answered four or fewer of 12 homebuying and mortgage questions correctly, while only one respondent answered all 12 questions correctly.
The survey polled 2,012 U.S. adults who have never owned a home but expect to purchase one within the next five years.
“Homebuying isn’t just a milestone — it’s a long-term financial commitment with implications that can last decades,” Serhat Oztop, head of home lending at Wells Fargo, said in a statement. “When buyers overestimate what they know, they’re more likely to make decisions that cost them time, money, or both.”
Knowledge Gaps Identified
Wells Fargo said the survey revealed significant confusion about several fundamental aspects of the homebuying process, including:
- Only 25% of respondents knew when they should apply for a mortgage.
- Nearly 90% did not understand what expenses are included in closing costs.
- Eighty-eight percent were unclear about the first steps in the homebuying process.
- Eight in 10 said they would take a potentially costly step when making a competitive offer, including sharing a pre-approval letter showing their maximum approved loan amount with a seller.
According to Wells Fargo, understanding closing costs represented the largest knowledge gap identified in the survey.
The findings suggest many prospective buyers enter the market without a clear understanding of financing timelines, transaction costs or negotiation strategies, the company said.
Where Buyers Are Getting Information
The survey also examined where prospective homebuyers seek advice and information.
According to Wells Fargo, most respondents said they rely on friends and family members, real estate websites, online listings and internet search engines for guidance. Only about one-third identified lenders or financial professionals as a primary source of information.
The survey found younger respondents were more likely to turn to social media, online influencers and artificial intelligence tools for advice, while older participants were more likely to seek guidance from banks, lenders and financial advisers.
Educational Opportunity
Despite the results, Wells Fargo said the findings point to an opportunity for greater consumer education rather than cause for concern.
According to the survey, nearly two-thirds of respondents said taking the quiz left them feeling more motivated, encouraged or aware of areas where they need additional knowledge before purchasing a home.
Oztop said the purpose of the quiz was to help prospective buyers identify knowledge gaps before entering the market.
“This quiz wasn’t about passing or failing,” Oztop said in the statement. “It was about helping people see where they might be vulnerable — and giving them the confidence that comes from being truly prepared.”
The survey was conducted online by Ipsos among adults ages 18 to 65 who reported some degree of financial readiness and said they expect to purchase a home within the next five years.
