How much do you really need to put down on a house? You have heard 20% for years — the number that avoids private mortgage insurance and signals serious buying power. But in 2026, most first-time buyers put down far less. Minimums start at 0% for VA and USDA loans, 3% for some conventional programs, and 3.5% for FHA. The right down payment for you depends on your loan type, savings, monthly budget, and long-term goals. Here is a complete breakdown.
Minimum Down Payments by Loan Type
Each mortgage program sets its own floor. Your credit score, debt levels, and property type can shift requirements within those programs, but these are the standard starting points in 2026.
- Conventional (Fannie Mae / Freddie Mac): 3% for first-time buyers, 5% for repeat buyers on primary residences
- FHA: 3.5% with credit score 580+, or 10% with score 500–579
- VA: 0% for eligible veterans, active-duty military, and qualifying surviving spouses
- USDA: 0% for qualifying properties in eligible rural and suburban areas
- Jumbo loans: typically 10–20% due to higher loan amounts and stricter underwriting
Investment properties and second homes require more skin in the game — usually 15–25% down on conventional loans. Lenders view non-primary residences as higher risk, and pricing reflects that.
The 20% Down Payment Myth
Twenty percent is not a requirement — it is a threshold. Below 20% on a conventional loan, you will pay private mortgage insurance. Above it, you will not. That single distinction drives a lot of buyer anxiety, but the math does not always favor waiting years to save a full 20%.
Consider a $400,000 home. Twenty percent down is $80,000. Five percent is $20,000 — a $60,000 difference. If you wait three years to save the extra $60,000 while home prices rise 4% annually, that same home costs roughly $450,000, and 20% down now requires $90,000. You saved $60,000 but the goalpost moved $10,000. Meanwhile, you paid rent and built no equity. Timing matters as much as the percentage.
When 20% Down Makes Sense
- You have ample savings after closing — emergency fund intact
- PMI costs would significantly strain your monthly budget
- You want the lowest possible monthly payment for long-term affordability
- You are buying in a competitive market where stronger offers win
Try it yourself — adjust the numbers below
Your Finances
Car loans, student loans, credit cards, etc.
Your Affordability Range
You can afford homes between $275,000 and $308,000
Based on a 6.25% interest rate and 35.1% debt-to-income ratio
Recommended Price
$275,000
$1,771.40/mo · conservative
Maximum Price
$308,000
$1,983.97/mo · upper limit
Monthly Payment Breakdown
35.1%
Your DTI is within ideal range. Lenders typically approve up to 43%.
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How Down Payment Size Affects Your Monthly Payment
A larger down payment reduces your loan amount, which lowers both principal and interest portions of your payment. It also shrinks or eliminates PMI. The combined effect is powerful: going from 5% to 20% down on a $350,000 home can reduce your monthly housing cost by $400 to $600 or more, depending on rates and PMI.
Use the affordability calculator above to model different down payment scenarios side by side. Small changes in the down payment percentage produce meaningful shifts in what you can afford and what you will pay each month. Pair that with our PMI guide to understand the insurance cost you will carry until you reach 20% equity.
Low Down Payment Programs for 2026
Conventional 3% Programs
Fannie Mae's HomeReady and Freddie Mac's Home Possible both allow 3% down for qualifying first-time and low-to-moderate income buyers. These programs offer reduced PMI costs and accept non-traditional income sources like boarder income in some cases. Income limits apply based on area median income.
FHA Loans
FHA remains the go-to for buyers with moderate credit and limited savings. The 3.5% minimum is accessible, but FHA mortgage insurance lasts for the life of the loan if you put less than 10% down. Budget for both the upfront mortgage insurance premium (1.75% of the loan, usually financed) and the annual premium.
VA and USDA Zero-Down Options
If you qualify, VA and USDA loans remove the down payment hurdle entirely. VA loans add a funding fee (waived for some disabled veterans); USDA charges an upfront and annual guarantee fee. Even with these fees, zero down can accelerate your path to ownership dramatically.
Down Payment Assistance and Gift Funds
You do not always need to save every dollar yourself. Down payment assistance programs — grants, forgivable loans, and employer benefits — can bridge the gap. Gift funds from family are accepted on most loan types with proper documentation. Some programs require you to contribute a minimum amount from your own funds, often 1–3% of the purchase price.
Our first-time homebuyer guide covers assistance programs in more detail, including how to find state and local resources in your area.
Finding Your Right Down Payment
There is no universal right answer. A physician with strong income and thin savings might choose 5% down, pay PMI briefly, and invest cash reserves elsewhere. A buyer nearing retirement may prefer 20% down or more to minimize monthly obligations. The best down payment balances four factors: your savings safety net, monthly payment comfort, total interest cost over time, and opportunity cost of cash tied up in the home.
Run the numbers at 3%, 5%, 10%, and 20% using the calculator on this page. Talk to a lender about PMI costs at each level. Then choose the down payment that lets you buy a home you can afford — not just on closing day, but for every month and every financial surprise that follows.