The standard benchmark for a down payment on a house is 20% of the purchase price, but most buyers pay far less than that. First-time buyers put down a median of 10%, and several loan programs allow as little as 3% or 3.5% down. Some government-backed loans require no down payment at all.
What you actually need depends on the type of mortgage you choose, your credit score, and whether you qualify for any special programs. Here’s how the numbers break down.
Minimum Down Payments by Loan Type
Different mortgage products have different floors for how much you need upfront. The four main categories cover nearly every homebuyer.
- Conventional loans: As low as 3% for qualified first-time buyers, though 5% is a more common minimum. You’ll need decent credit (typically 620 or higher) to qualify at the lowest tier.
- FHA loans: 3.5% with a credit score of 580 or above. If your score falls between 500 and 579, you’ll need at least 10% down. FHA loans tend to be the cheapest option for borrowers with lower credit or very small down payments.
- VA loans: 0% down for eligible active-duty service members, veterans, and surviving spouses. There’s no private mortgage insurance requirement either, which makes this one of the most favorable loan types available.
- USDA loans: 0% down for buyers purchasing in eligible rural areas whose household income falls within program limits. The property and the buyer both have to meet USDA criteria.
On a $350,000 home, the difference between these minimums is significant. A 3% down payment means $10,500 out of pocket. At 3.5%, that’s $12,250. And at 20%, you’re looking at $70,000.
What Buyers Actually Put Down
The median down payment on a home in the U.S. in 2025 was 19% of the purchase price. That number is skewed upward by repeat buyers, who put down a median of 23%, often using equity from a previous home sale. First-time buyers told a very different story, with a median down payment of just 10%.
If you’re buying your first home and worrying that you need 20% saved, the data says most people in your position don’t get anywhere near that figure. A 10% down payment on a $350,000 house is $35,000, which is still a large sum but roughly half of the traditional target.
Why 20% Still Matters
The 20% figure isn’t a requirement for most loans, but it is the threshold where you avoid paying private mortgage insurance, commonly called PMI. PMI protects the lender if you default, and you’re the one paying for it as long as your equity stays below 20%.
PMI costs vary based on your credit score, your loan amount, and the insurer, but you can expect to pay between $30 and $150 per month for every $100,000 borrowed. On a $300,000 mortgage, that could add $90 to $450 to your monthly payment. Over several years, that adds up to thousands of dollars.
The good news is that PMI isn’t permanent. Once you’ve built 20% equity in your home, whether through payments or rising home values, you can ask your lender to cancel it. FHA loans are the exception: their mortgage insurance premiums typically last the life of the loan unless you refinance into a conventional mortgage.
How Your Down Payment Affects Your Monthly Cost
A larger down payment reduces your loan balance, which lowers both your monthly payment and the total interest you’ll pay over the life of the mortgage. On a $400,000 home at a 7% interest rate with a 30-year term, putting 5% down ($20,000) means borrowing $380,000. Your principal and interest payment would be roughly $2,528 per month, plus PMI. Put 20% down ($80,000) and you borrow $320,000, dropping that payment to about $2,129 with no PMI.
That’s a difference of around $400 a month before you even factor in insurance savings. Over 30 years, the smaller loan also saves you tens of thousands in interest. But there’s a tradeoff: the years you spend saving up a larger down payment are years you’re not building equity through homeownership, and home prices may rise in the meantime.
Down Payment Assistance Programs
Hundreds of programs across the country help buyers cover part or all of their down payment. These typically come in a few forms: forgivable grants that don’t need to be repaid if you stay in the home for a set number of years, deferred-payment second mortgages with no monthly payment due until you sell or refinance, and low-interest second loans with modest monthly payments.
Eligibility usually depends on your household income, the purchase price of the home, and whether you’re a first-time buyer. Many programs cap household assets (excluding retirement accounts) and require a minimum credit score, often in the 640 to 660 range. Some programs also let you combine assistance funds with gift money from family members.
Your lender or a HUD-approved housing counselor can help you identify programs you qualify for in your area. Many buyers don’t realize these exist, so it’s worth checking before you assume you need to come up with the full down payment on your own.
Other Upfront Costs Beyond the Down Payment
Your down payment isn’t the only cash you need at closing. Closing costs, which cover lender fees, title insurance, appraisal, and prepaid items like property taxes and homeowners insurance, typically run 2% to 5% of the loan amount. On a $300,000 mortgage, that’s $6,000 to $15,000 on top of your down payment.
Some buyers negotiate for the seller to cover a portion of closing costs, and certain loan programs allow the lender to roll some fees into the loan balance. But you should plan for these expenses when setting your savings target. If you’re aiming for a 5% down payment, budget for roughly 7% to 10% of the home price in total upfront cash to give yourself a realistic cushion.