How Much Down Payment Do You Need to Buy a House?
Mike Starr
Founder, MortgageWizardTools · M.S. Organizational Management
The amount you need for a down payment depends on the loan type, your credit, and your financial goals. While 20% has long been the benchmark, many buyers purchase with far less — some with nothing down at all.
Minimum Down Payments by Loan Type
| Loan Type | Minimum Down | Key Detail |
|---|---|---|
| Conventional | 3% | First-time buyers; 5% for repeat |
| FHA | 3.5% | With credit score 580+ |
| VA | 0% | For eligible veterans |
| USDA | 0% | In eligible rural areas |
The 20% Benchmark
Putting 20% down eliminates PMI (private mortgage insurance) on conventional loans, which can save $100 to $300+ per month. It also means a smaller loan, lower monthly payment, and more equity from day one. But 20% is not required, and waiting years to save it can mean missing out on home price appreciation.
Low Down Payment Pros and Cons
Pros: Buy sooner, keep cash for emergencies and repairs, start building equity earlier, potentially benefit from home appreciation.
Cons: PMI required (on conventional under 20%), higher monthly payment, more interest over the life of the loan, less equity if home values decline.
How to Decide
- •If you have 20% without draining savings: put it down and avoid PMI
- •If 20% would drain your emergency fund: put down less and keep reserves
- •If home prices are rising faster than you can save: buy sooner with less down
- •If you qualify for VA or USDA: take advantage of 0% down
Key Takeaways
- •You do not need 20% down — minimums range from 0% to 5%
- •20% eliminates PMI on conventional loans
- •Low down payments let you buy sooner but cost more monthly
- •Never drain your emergency fund to make a larger down payment
- •Use our Down Payment Calculator to compare scenarios