How much down payment do you need for a house?

The minimum down payment depends on your loan type: $0 (0%) for VA loans (veterans) and USDA loans (rural areas), 3% for conventional loans (Fannie Mae HomeReady/Freddie Mac Home Possible), 3.5% for FHA loans (most popular for first-time buyers), 10-20% for jumbo loans, and 15-25% for investment properties. On a $350,000 home: 3% = $10,500, 3.5% = $12,250, 5% = $17,500, 10% = $35,000, 20% = $70,000. The average first-time buyer puts down 8% in 2026.

Is 20% down payment required?

No, 20% down is NOT required. It is a common myth. You can buy a home with as little as 0% down (VA, USDA) or 3% down (conventional). The only advantage of 20% down is avoiding Private Mortgage Insurance (PMI), which costs $100-$300/month on a $350K home. However, many buyers benefit more from buying sooner with less down than waiting years to save 20%. The average first-time buyer puts down just 8%.

How much is PMI if I put less than 20% down?

PMI costs 0.3-1.5% of the loan amount per year, depending on credit score and down payment percentage. On a $350K home with 5% down ($332,500 loan): PMI ranges from $83/month (excellent credit) to $416/month (fair credit). Average is about $150-$200/month. PMI automatically cancels once you reach 20% equity. FHA loans have MIP (0.55%/year) which lasts the life of the loan unless you refinance.

How Much Down Payment for a House in 2026? ($0 to 20% Options)

Down Payment by Loan Type (on a $350,000 Home)

Loan Type	Min Down %	$ Amount	Min Credit	PMI?	Best For
VA Loan	0%	$0	620	No PMI!	Veterans, active military
USDA Loan	0%	$0	640	0.35% fee	Rural/suburban areas
Conventional 3%	3%	$10,500	620	Yes until 20% equity	Good credit, first-timers
FHA Loan	3.5%	$12,250	580	MIP for life	Lower credit scores
Conventional 5%	5%	$17,500	620	Yes until 20%	Better rates than 3%
Conventional 10%	10%	$35,000	620	Yes until 20%	Lower PMI cost
Conventional 20%	20%	$70,000	620	No PMI!	Best rate, no PMI

How Down Payment Affects Your Monthly Payment

Down Payment	Loan Amount	Monthly P&I	PMI/MIP	Total Monthly*
0% (VA)	$350,000	$2,128	$0	$2,728
3%	$339,500	$2,064	$170	$2,834
3.5% (FHA)	$337,750	$2,054	$155	$2,809
5%	$332,500	$2,022	$133	$2,755
10%	$315,000	$1,916	$95	$2,611
20%	$280,000	$1,703	$0	$2,303

*Includes estimated taxes ($365/mo) + insurance ($235/mo). Based on $350K home, 6.10% rate, 30-year fixed. PMI at 0.5% annual for 740 credit.

🏠 Find Out How Much YOU Need

Get pre-approved to see your actual down payment requirement, rate, and monthly payment. Takes 15 minutes. No commitment.

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Should You Wait for 20% or Buy Now with 3%?

The Math: Buying Now (3% Down) vs. Waiting 3 Years (20% Down)

Buy Now: 3% Down ($10,500)

Monthly payment: $2,834
PMI for ~5 years: ~$10,200
3 years of equity built: ~$25,000
3 years of appreciation (4%/yr): ~$43,700
Net wealth gain: +$58,500

Wait 3 Years: 20% Down ($70,000)

3 years of rent: ~$54,000
Savings needed: $70,000
Home price in 3 years: ~$393,700
Higher purchase price: +$43,700
Net cost of waiting: -$97,700

Bottom line: In most markets, buying with 3% down and paying PMI for a few years is financially smarter than waiting to save 20%. The home appreciation and equity building during those years outweigh the PMI cost.

Where to Get Your Down Payment

💰 Down Payment Assistance (DPA)

47 states offer programs providing $2,500-$25,000 in grants or forgivable loans. Most require income below 80-120% of area median. Apply through your state Housing Finance Agency (HFA).

Tax credit + DPA guide →

🎁 Gift Funds

Family members can gift your entire down payment. You'll need a signed gift letter stating it's not a loan. FHA, VA, USDA, and most conventional loans accept gift funds for 100% of the down payment.

Gift fund rules →

🏦 IRA Withdrawal

First-time buyers can withdraw up to $10,000 from a traditional IRA penalty-free. Roth IRA contributions (not earnings) can be withdrawn tax-free at any time.

🤝 Seller Concessions

Sellers can contribute 3-6% of the purchase price toward your closing costs, freeing up your savings for the down payment. In buyer's markets, this is very common.

Seller concessions guide →

Best Low Down Payment Options

🎖️ VA Loans: $0 Down (Veterans & Military)

The best mortgage program in America. Zero down payment, no PMI, competitive rates (5.65% avg). Available to veterans, active-duty service members, National Guard, Reserves, and surviving spouses.

VA Loan Calculator →Check VA Eligibility →

🏠 FHA Loans: 3.5% Down (580+ Credit)

Most popular for first-time buyers and borrowers with lower credit scores. Only 3.5% down with 580+ credit (10% with 500-579). More flexible DTI requirements (up to 50%). Downside: MIP (mortgage insurance premium) for life of loan.

FHA Calculator →Get FHA Pre-Approved →

🏡 Conventional 3%: HomeReady & Home Possible

Fannie Mae HomeReady and Freddie Mac Home Possible allow just 3% down for borrowers earning ≤80% of area median income. PMI is lower than standard conventional and cancels at 20% equity. No MIP for life like FHA.

3% Down Conventional Guide →

Down Payment Savings Plan: Hit Your Goal in 12-24 Months

Home Price	3% Down	Save $500/mo	Save $1,000/mo	Save $1,500/mo	Save $2,000/mo
$250,000	$7,500	15 months	8 months	5 months	4 months
$350,000	$10,500	21 months	11 months	7 months	5 months
$450,000	$13,500	27 months	14 months	9 months	7 months
$550,000	$16,500	33 months	17 months	11 months	8 months

Turbo-charge your savings: Open a High-Yield Savings Account (HYSA) earning 4.5-5.0% APY. On $10,000 saved over 12 months, you earn $250-$500 in interest. Automate transfers on payday so you never see the money. Set up a separate "House Fund" account to track progress.

PMI Deep-Dive: What It Costs & How to Remove It

Down Payment	LTV	PMI Rate	Monthly PMI ($350K loan)	Annual Cost	When It Drops Off
3%	97%	0.80-1.10%	$233-$321	$2,800-$3,850	At 78% LTV (auto) or 80% (request)
5%	95%	0.55-0.85%	$160-$248	$1,925-$2,975	At 78% LTV (auto) or 80% (request)
10%	90%	0.30-0.55%	$88-$160	$1,050-$1,925	At 78% LTV (auto) or 80% (request)
15%	85%	0.15-0.35%	$44-$102	$525-$1,225	At 78% LTV (auto) or 80% (request)
20%	80%	$0	$0	$0	No PMI ever

4 Ways to Remove PMI Faster

Make extra payments — every extra dollar goes to principal, reaching 80% LTV faster
Request removal at 80% LTV — don't wait for automatic removal at 78%
Get a new appraisal — if your home appreciated, you may already be at 80% LTV ($400-$500 cost)
Refinance — if your home value increased significantly, refi into a new loan with no PMI

FHA MIP Warning

FHA mortgage insurance (MIP) is permanent for loans with less than 10% down. It NEVER goes away unless you refinance into a conventional loan. Upfront MIP: 1.75% of loan. Annual MIP: 0.55% of loan. On a $350K FHA loan, that's $6,125 upfront + $1,925/year forever. Plan to refinance to conventional once you hit 20% equity.

Top 10 Down Payment Assistance Programs by State

State	Program	Amount	Type	Income Limit
California	CalHFA MyHome	Up to $25,000	Deferred loan (0% interest)	Varies by county
Texas	TDHCA My First Texas Home	Up to 5% of loan	Grant (free money)	$97,600
Florida	FL Housing First Time Buyer	Up to $15,000	Forgivable loan (5 yr)	$118,950
New York	SONYMA Down Payment	Up to $15,000	Low-interest loan	$128,000
Illinois	IHDA 1stHomeIllinois	$7,500 grant	Grant (free money)	$97,000
Georgia	Georgia Dream	Up to $10,000	0% deferred loan	$85,800
Colorado	CHFA Down Payment	Up to 3% of loan	Grant or second mortgage	$150,200
Virginia	VHDA Down Payment Grant	Up to 2.5% of price	Grant (free money)	$99,500
Washington	WSHFC Home Advantage	Up to $15,000	0% deferred loan	$180,000
North Carolina	NC Home Advantage	Up to $15,000	Forgivable (15 yr)	$110,000

Income limits are for 2026 and vary by household size and county. Over 2,000 DPA programs exist nationwide. Check our complete state-by-state guide for your specific program.

5 Down Payment Myths Busted

MYTH: "You need 20% down to buy a house."

FACT: The average first-time buyer puts down just 6%. VA and USDA offer 0% down. FHA requires only 3.5%. Conventional allows 3% with HomeReady/Home Possible.

MYTH: "PMI is a waste of money."

FACT: PMI costs $100-$300/month but lets you buy 5-10 years sooner. In that time, your home appreciates $50K-$150K. PMI is temporary — it drops off at 80% LTV. The math overwhelmingly favors buying with PMI vs. waiting.

MYTH: "You can't use gift money for a down payment."

FACT: ALL major loan types accept gift funds. FHA, VA, USDA, and conventional all allow 100% of the down payment to come from family gifts. You just need a signed gift letter.

MYTH: "Down payment assistance is only for low-income buyers."

FACT: Many DPA programs have income limits up to $150K-$180K. Some have no income limits at all. Teachers, nurses, first responders, and military often qualify for special programs regardless of income.

MYTH: "A bigger down payment always means a better deal."

FACT: Putting 20% down eliminates PMI but ties up cash. If you invest that extra 17% ($59,500 on a $350K home) in the stock market at 10% avg return, you'd have $154K in 10 years — far more than the $18K you'd save on PMI.

Related Resources

How Much House Can I Afford? →Mortgage Payment Calculator →First-Time Buyer Tax Credit →Best Mortgage Lenders 2026 →Improve Credit Score →PMI Calculator →

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Editorial Note: Down payment requirements from Fannie Mae, Freddie Mac, FHA, VA, and USDA guidelines. Average buyer stats from NAR 2025 Profile of Home Buyers and Sellers. Updated Feb 13, 2026. Editorial standards.