# How Much Down Payment Do You Need for a House? 2026 Guide By Jean Folger | 2022-08-30 > A down payment is the portion of a home's purchase price you pay a lender at closing. Your down payment could be anywhere from 3% to 20% or more, depending on the lender, the mortgage type, and your financial situation. In general, the higher your down payment, the lower your loan costs will be in the long run. ## Key Takeaways ## Key Takeaways - A down payment is the amount you pay toward your home's purchase price at closing. - The size of your down payment affects how much your lender will loan you and your overall mortgage costs.  - A smaller down payment makes it easier to buy a home, but your overall costs will be higher. - A larger down payment helps you qualify for lower interest rates and avoid mortgage insurance, but it can deplete your savings.  - The [National Association of Realtors](https://cdn.nar.realtor/sites/default/files/documents/2022-home-buyers-and-sellers-generational-trends-03-23-2022.pdf) (NAR) says that most buyers fund a down payment using their savings, proceeds from the sale of a primary residence, or a gift from a friend or relative. - Various programs help first-time buyers, veterans, service members, rural residents, and lower-income borrowers buy a home with a small down payment. Figuring out how much to put down on a house is one of the biggest financial decisions you'll make as a homebuyer — and one of the most misunderstood. Many buyers assume they need 20% down to purchase a home, but the reality is that most people put down far less. The right down payment amount depends on your loan type, your financial situation, and your long-term goals. Conventional loans allow as little as 3% down. FHA loans start at 3.5%. VA and USDA loans require nothing down at all. And according to the [National Association of Realtors (NAR)](https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers), the median down payment for first-time buyers in 2024 was just 9%. Below, we break down how much down payment for a house you actually need, what the average down payment on a house looks like today, and how to choose the right down payment percentage for your budget. Use our calculator to run the numbers on any home price. [Get your offer](#) ## Down Payment Calculator **Use this tool to estimate your down payment, loan amount, and monthly payment.** Enter your target home price, select a down payment percentage, and see how different scenarios affect what you'll owe each month — including whether you'll pay private mortgage insurance (PMI). *\[Interactive calculator: Input fields for home price, down payment percentage slider (0%, 3%, 3.5%, 5%, 10%, 15%, 20%), estimated interest rate. Outputs: down payment dollar amount, total loan amount, estimated monthly principal & interest, PMI estimate (yes/no + approximate monthly cost).\]* > **Tip:** Try running multiple scenarios side by side. Even a 2–3% difference in your down payment can shift your monthly payment by hundreds of dollars. For a broader view of upfront costs, see our guide on [how much it costs to buy a house](https://www.opendoor.com/articles/how-much-does-it-cost-to-buy-a-house). ## How Much Is a Down Payment on a House? A **down payment** is the portion of a home's purchase price you pay upfront in cash at closing. The remainder is covered by your mortgage loan. Down payments typically range from 0% to 20% or more, depending on the loan program and lender requirements. Here's what the down payment looks like in dollar terms across common home prices and percentages: | **Home Price** | **3% Down** | **3.5% Down** | **5% Down** | **10% Down** | **15% Down** | **20% Down** | | $200,000 | $6,000 | $7,000 | $10,000 | $20,000 | $30,000 | $40,000 | | $300,000 | $9,000 | $10,500 | $15,000 | $30,000 | $45,000 | $60,000 | | $400,000 | $12,000 | $14,000 | $20,000 | $40,000 | $60,000 | $80,000 | | $500,000 | $15,000 | $17,500 | $25,000 | $50,000 | $75,000 | $100,000 | | $600,000 | $18,000 | $21,000 | $30,000 | $60,000 | $90,000 | $120,000 | As you can see, even on a $400,000 home, the difference between 3% and 20% down is $68,000. That gap is why understanding the minimum down payment for a house — and what percentage actually makes sense for your finances — matters so much. Keep in mind that your down payment isn't your only upfront cost. You'll also need to budget for [closing costs](https://www.opendoor.com/articles/how-much-are-closing-costs-for-seller), [earnest money](https://www.opendoor.com/articles/earnest-money), a home inspection, and moving expenses. For a full breakdown, check out our guide on [how much to save for a house](https://www.opendoor.com/articles/how-much-to-save-for-house). ## Average Down Payment on a House If you're wondering what other buyers actually put down, you're not alone. "Average down payment on a house" is one of the most-searched homebuying questions — and the answer might surprise you. ### First-Time Buyers vs. Repeat Buyers According to the [2024 NAR Profile of Home Buyers and Sellers](https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers), the median down payment varies significantly by buyer type: | **Buyer Type** | **Median Down Payment** | | First-time homebuyers | 9% | | Repeat buyers | 23% | | All buyers | 18% | Repeat buyers typically have more cash available — often from the [sale of a previous home](https://www.opendoor.com/articles/how-to-sell-your-house) — which explains the wide gap. First-time buyers, on the other hand, are more likely to use low-down-payment loan programs or assistance from family. ### Average Down Payment by Age Group The NAR data also shows clear generational differences: | **Age Group** | **Median Down Payment** | | 25–33 | 10% | | 34–43 | 12% | | 44–58 | 18% | | 59–68 | 22% | | 69+ | 28% | Younger buyers tend to have less savings and home equity, so they lean on lower down payment options. Older buyers — many of whom are purchasing their second or third home — bring more cash to the table. ### How Averages Have Changed Over Time Down payment norms have shifted in recent years. According to NAR's annual surveys from [2019 through 2024](https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers), the median first-time buyer down payment has ranged between 6% and 9%, while repeat buyer medians have hovered between 16% and 23%. Rising home prices have made it harder to save a large percentage, but low-down-payment loan programs have kept homeownership accessible. The key takeaway: **putting down 20% is not the norm**, and it hasn't been for years. ## Minimum Down Payment by Loan Type The minimum down payment for a house depends almost entirely on which mortgage program you use. Here's a side-by-side comparison: | **Loan Type** | **Minimum Down Payment** | **Credit Score Requirement** | **Mortgage Insurance** | | Conventional | 3% | 620+ | PMI required below 20% down | | FHA | 3.5% (580+ credit) or 10% (500–579 credit) | 500+ | MIP required for the life of the loan (with <10% down) | | VA | 0% | No minimum (lender-set, typically 620+) | No PMI; one-time VA funding fee | | USDA | 0% | 640+ (typically) | Guarantee fee (upfront + annual) | | Jumbo | 10–20% (varies by lender) | 700+ (typically) | Varies by lender | ### Conventional Loans (3% Minimum) Conventional loans backed by Fannie Mae and Freddie Mac offer down payments as low as 3% for qualifying buyers. Programs like [Fannie Mae's HomeReady](https://singlefamily.fanniemae.com/originating-underwriting/mortgage-products/homeready-mortgage) and [Freddie Mac's Home Possible](https://sf.freddiemac.com/working-with-us/origination-underwriting/mortgage-products/home-possible) are specifically designed for low- and moderate-income borrowers and first-time buyers. With a conventional loan and less than 20% down, you'll pay **private mortgage insurance (PMI)** — but it can be canceled once you reach 20% equity, which is a significant advantage over FHA loans. ### FHA Loans (3.5% Minimum) Federal Housing Administration (FHA) loans are popular among first-time buyers because of their lower credit score requirements. With a [credit score of 580 or higher](https://www.hud.gov/buying/loans), you can put down as little as 3.5%. Scores between 500 and 579 require 10% down. The trade-off: FHA loans carry **mortgage insurance premiums (MIP)** — both an upfront premium (1.75% of the loan amount) and an annual premium. If you put down less than 10%, MIP lasts the entire life of the loan unless you refinance into a conventional mortgage. ### VA Loans (0% Down) If you're an eligible veteran, active-duty service member, or surviving spouse, [VA loans](https://www.va.gov/housing-assistance/home-loans/) offer one of the best deals in homebuying: **0% down payment and no PMI**. You'll pay a one-time VA funding fee (typically 1.25%–3.3% depending on down payment and usage), which can be rolled into the loan. VA loans consistently offer competitive interest rates and flexible qualification requirements, making them one of the most powerful tools for eligible buyers. ### USDA Loans (0% Down) The [USDA Rural Development loan program](https://www.rd.usda.gov/programs-services/single-family-housing-programs/single-family-housing-guaranteed-loan-program) also offers **0% down** for buyers in eligible rural and suburban areas. Income limits apply — generally, your household income can't exceed 115% of the area median income. USDA loans charge a 1% upfront guarantee fee and a 0.35% annual fee, which is significantly lower than FHA mortgage insurance. ### Jumbo Loans (10–20% Typical) Jumbo loans finance home purchases above the conforming loan limit ([currently $766,550 in most counties for 2025](https://www.fhfa.gov/data/conforming-loan-limit)). Because these loans aren't backed by Fannie Mae or Freddie Mac, lenders take on more risk and typically require 10–20% down, higher credit scores (often 700+), and larger cash reserves. Some lenders offer jumbo loans with as little as 5–10% down for highly qualified borrowers, so it's worth shopping around. ## Down Payment Percentage: How to Decide What's Right for You Choosing the right down payment percentage isn't just about hitting a minimum — it's about balancing your upfront investment against your monthly budget, savings, and long-term financial health. Here's a framework to guide your decision. ### Your Emergency Fund and Cash Reserves A cardinal rule of homebuying: **don't drain your savings to make a larger down payment.** Financial experts generally recommend keeping three to six months of living expenses in reserve after closing. Homeownership comes with unexpected costs — a broken HVAC system, a roof repair, or a plumbing emergency. If a 20% down payment would leave you with an empty savings account, a lower down payment is the smarter move. You can learn more about budgeting for these costs in our guide on [how much to save for a house](https://www.opendoor.com/articles/how-much-to-save-for-house). ### Your Debt-to-Income Ratio Lenders evaluate your **debt-to-income ratio (DTI)** — your total monthly debt payments divided by your gross monthly income. Most mortgage programs cap DTI at 43–50%. A larger down payment reduces your loan amount (and therefore your monthly payment), which can help you qualify if your DTI is tight. Conversely, if your DTI is comfortably low, putting less down and preserving liquidity may be the better strategy. ### How Your Down Payment Affects Your Interest Rate Lenders often offer slightly lower interest rates to borrowers who put more money down, because a larger down payment lowers their risk. According to [Freddie Mac's research](http://www.freddiemac.com/research), borrowers with 20%+ down payments historically receive rates approximately 0.125–0.25% lower than those with 5% down. That difference may sound small, but over 30 years it adds up to thousands of dollars. The exact impact depends on your credit profile, market conditions, and the lender — always compare quotes from multiple lenders. ### The True Cost of PMI (Private Mortgage Insurance) If you put less than 20% down on a conventional loan, you'll pay **private mortgage insurance (PMI)** to protect the lender in case you default. PMI typically costs between [0.2% and 2% of your loan amount annually](https://www.consumerfinance.gov/ask-cfpb/what-is-private-mortgage-insurance-en-122/), depending on your credit score, down payment percentage, and loan type. Here's what PMI might look like on a **$350,000 home** at different down payment levels: | **Down Payment %** | **Down Payment $** | **Loan Amount** | **Estimated Monthly PMI** | **PMI Required?** | | 3% | $10,500 | $339,500 | $140–$280 | Yes | | 5% | $17,500 | $332,500 | $110–$250 | Yes | | 10% | $35,000 | $315,000 | $80–$180 | Yes | | 15% | $52,500 | $297,500 | $50–$120 | Yes | | 20% | $70,000 | $280,000 | $0 | No | The good news: unlike FHA mortgage insurance, **conventional PMI can be removed** once your home equity reaches 20% (either through payments or appreciation). Your lender must automatically cancel it when you reach 22% equity based on the original loan balance. ### Scenario Comparison: 5% vs. 10% vs. 20% Down Let's see how different down payment percentages play out on a **$400,000 home** with a 6.5% interest rate over 30 years: | | **5% Down ($20K)** | **10% Down ($40K)** | **20% Down ($80K)** | | Loan amount | $380,000 | $360,000 | $320,000 | | Monthly P&I | $2,402 | $2,275 | $2,023 | | Estimated monthly PMI | ~$190 | ~$130 | $0 | | Total monthly (P&I + PMI) | ~$2,592 | ~$2,405 | $2,023 | | Total interest paid (30 yr) | $484,720 | $459,000 | $408,240 | | Total cost (payments + down) | $953,120 | $905,800 | $808,280 | The 20% down scenario saves roughly $145,000 in total cost compared to 5% down — but it requires **$60,000 more upfront**. For many buyers, especially first-timers, that cash simply isn't available. The "right" answer depends entirely on your financial picture. If you're weighing your options, understanding how to [make a competitive offer on a house](https://www.opendoor.com/articles/how-to-determine-what-to-offer-on-a-house) with different down payment levels can also shape your strategy. ## Do You Really Need to Put 20% Down? **No — and most buyers don't.** The 20% figure dates back to an era before widespread mortgage insurance programs and low-down-payment loan options. Today, it's more of a benchmark than a requirement. As noted above, the [median down payment for first-time buyers is 9%](https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers), and millions of buyers purchase homes each year with 3–5% down. VA and USDA borrowers routinely buy with 0% down. **When 20% down still makes sense:** - You want the **lowest possible monthly payment** and interest rate - You want to **avoid PMI entirely** - You have sufficient savings and a healthy emergency fund even after the down payment - You're buying in an extremely competitive market where a large down payment strengthens your offer - You're purchasing a jumbo loan property that requires it **When putting less than 20% down makes sense:** - You're a first-time buyer with limited savings - You want to **get into the market sooner** rather than waiting years to save more - You'd rather invest excess cash elsewhere for potentially higher returns - Home prices in your area are rising, and waiting could cost more than PMI - You qualify for a VA, USDA, or low-down-payment conventional program The bottom line: putting 20% down is a fine goal, but it shouldn't be a barrier to homeownership if you're financially ready in other ways. What matters more is that you can comfortably afford the monthly payment, have cash reserves for emergencies, and aren't overextending your budget. > To understand the [full timeline of buying a home](https://www.opendoor.com/articles/briefs/how-long-does-it-take-to-buy-a-house) — from saving your down payment through closing day — explore our step-by-step guide. ## Down Payment Assistance Programs If saving for a down payment feels out of reach, you may qualify for **down payment assistance (DPA)** — grants, forgivable loans, or subsidized second mortgages that help cover your upfront costs. Thousands of programs exist at the federal, state, and local levels. ### Federal Programs - **FHA loans** with 3.5% down are themselves a form of federal assistance, lowering the barrier to entry for buyers with moderate credit scores. - **HUD's Good Neighbor Next Door Program** offers a [50% discount on HUD-owned homes](https://www.hud.gov/program_offices/housing/sfh/reo/goodn/gnndabot) for law enforcement officers, teachers, firefighters, and emergency medical technicians in designated revitalization areas. - **VA and USDA loans** eliminate the down payment entirely for eligible borrowers. ### State and Local Programs Nearly every state has a **housing finance agency (HFA)** that offers down payment assistance to qualifying buyers. These programs typically provide: - **Grants** (free money that doesn't need to be repaid) - **Forgivable second mortgages** (forgiven after you live in the home for a set number of years, often 5–10) - **Deferred-payment loans** (no payments due until you sell, refinance, or pay off the first mortgage) - **Low-interest second mortgages** with affordable repayment terms Eligibility usually depends on income, home price, and whether you're a first-time buyer. You can search for programs in your area through [HUD's state-by-state resource list](https://www.hud.gov/states). ### Employer-Assisted Housing Programs Some large employers offer housing benefits, including: - Direct down payment grants or forgivable loans - Matched savings programs - Subsidized mortgage rates through partner lenders Check with your HR department — these programs are more common than many buyers realize, particularly at hospitals, universities, and large corporations. ### Nonprofit Programs Organizations like the [Neighborhood Assistance Corporation of America (NACA)](https://www.naca.com/) offer mortgage programs with no down payment, no closing costs, and below-market interest rates to qualifying buyers. Other community-based nonprofits run homebuyer education courses that may unlock additional DPA funding. ## Using Gift Funds for a Down Payment Can someone else help with your down payment? In most cases, **yes**. All major loan types allow borrowers to use gift funds, though the rules vary. **Which loan types allow gift funds:** | **Loan Type** | **Gift Funds Allowed?** | **Key Rules** | | Conventional (5%+ down) | Yes — 100% of down payment can be a gift | Gift must come from a family member, fiancé/fiancée, or domestic partner | | Conventional (3–5% down) | Partially — buyer typically must contribute at least 3% from own funds for non-owner-occupied; varies by program | Check with lender | | FHA | Yes — 100% of 3.5% down can be a gift | Allowed from family, employer, charitable organization, or government agency | | VA | Yes | From family, friends, or employers | | USDA | Yes | From family members | **Gift letter requirements:** Your lender will require a signed gift letter from the donor confirming that: - The funds are a true gift and no repayment is expected - The donor's name, address, and relationship to the buyer - The dollar amount and date the funds will be (or were) transferred **Sourcing and seasoning:** Lenders may also ask for documentation showing the donor had the funds available (e.g., bank statements). Some lenders require gift funds to be "seasoned" in your account for 60 days before closing, though many accept them at any time with proper documentation. **Tax implications for the giver:** In 2025, the [annual gift tax exclusion is $19,000 per recipient](https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-taxes). Gifts above that amount count against the donor's lifetime exemption ($13.99 million in 2025) and require filing IRS Form 709. Most family gifts for down payments won't trigger actual tax, but the donor should consult a tax advisor. ## Piggyback Loans (80/10/10) A **piggyback loan** — also called an **80/10/10 loan** — is a strategy that lets you avoid PMI without putting 20% down. **How it works:** - **80%** — First mortgage covering 80% of the home price - **10%** — Second mortgage (often a home equity loan or HELOC) covering another 10% - **10%** — Your down payment (10% cash) Because the first mortgage is 80% of the home's value, no PMI is required. The second mortgage covers the gap. **Pros:** - **Eliminates PMI**, which can save hundreds per month - Lets you buy with only 10% down while avoiding mortgage insurance - Interest on the second mortgage may be tax-deductible (consult a tax professional) **Cons:** - **Two loan payments** to manage each month - The second loan (especially a HELOC) may have a **variable interest rate** that can increase over time - Not all lenders offer piggyback structures, so availability varies - Higher combined closing costs due to two loans **When it makes sense:** Piggyback loans tend to work best for buyers who have 10% down, strong credit (700+), and want to eliminate PMI. Compare the total monthly cost of a piggyback arrangement against a single loan with PMI — in some scenarios, the conventional loan with PMI is actually cheaper, especially if you expect to hit 20% equity quickly. > Want to learn more about creative financing strategies? Explore our guide on [ways to finance your home](https://www.opendoor.com/articles/eight-ways-to-finance-your-home-renovation-project) for additional options. ## Tips for Saving for Your Down Payment If you're still building toward your down payment goal, a few strategies can help you get there faster: - **Set a target based on a realistic home price.** Use the calculator above and research homes in your market to set a specific dollar goal rather than saving blindly. - **Automate your savings.** Set up automatic monthly transfers to a dedicated down payment savings account. - **Explore high-yield savings accounts.** Online savings accounts or money market accounts can earn 4–5% APY, putting your savings to work while you build. - **Reduce large monthly expenses.** Even a few months of lower rent (e.g., from moving to a less expensive apartment or adding a roommate) can accelerate your timeline. - **Look into \[seller concessions\](https://www.opendoor.com/articles/what-are-seller-concessions).** In some markets, sellers will cover a portion of your closing costs, freeing up cash for your down payment. - **Check your eligibility for DPA programs.** Free money from grants or forgivable loans can close the gap between what you've saved and what you need. - **Consider selling your current home first.** If you already own, the equity from your [home sale](https://www.opendoor.com/articles/how-to-sell-your-house) can fund a substantial down payment on your next property. Services like Opendoor can help you [sell your house fast](https://www.opendoor.com/articles/how-to-sell-your-house-fast-complete-guide) and unlock that equity on your timeline. ## The Bottom Line How much you should put down on a house depends on your loan type, savings, income, and comfort level — not on a one-size-fits-all rule. Most buyers don't put down 20%, and you don't have to either. The best approach: run the numbers using the calculator above, explore your loan options, and make a down payment that lets you buy comfortably while keeping your financial safety net intact. Whether you're [just starting your homebuying journey](https://www.opendoor.com/articles/briefs/how-long-does-it-take-to-buy-a-house) or getting ready to close, the right down payment is the one that fits your life. If you're also selling a home to fund your next purchase, [find out what your home is worth](https://www.opendoor.com/articles/whats-your-home-worth-take-these-steps-to-find-out) to see how much equity you can put toward your down payment. [Get your offer](#) ## Frequently Asked Questions **How much down payment do I need for a house?** The minimum down payment depends on your loan type. Conventional loans require as little as 3%, FHA loans require 3.5% (with a 580+ credit score), and VA and USDA loans offer 0% down for eligible borrowers. There is no universal minimum — the amount you need is determined by the mortgage program you choose. **Is a 20% down payment required to buy a home?** No. A 20% down payment is not required for any major loan type. It's a threshold that lets you avoid private mortgage insurance (PMI) on a conventional loan, but the [median first-time buyer puts down about 9%](https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers). Millions of Americans buy homes each year with far less than 20% down. **What is the minimum down payment for an FHA loan?** The minimum down payment for an FHA loan is 3.5% if your credit score is 580 or higher. If your score falls between 500 and 579, you'll need to put down at least 10%. FHA loans also require both upfront and annual mortgage --- *Originally published at [https://www.opendoor.com/articles/down-payment-amount](https://www.opendoor.com/articles/down-payment-amount)*