Home Buying
How much of a down payment do you really need?
The '20% down' rule is more myth than requirement. Here's what down payments actually look like — and the trade-offs of putting down less.
Ask around and you'll hear that you need 20% down to buy a home. For most buyers, that simply isn't true — and believing it keeps people renting far longer than they need to.
The real minimums
Many conventional loans allow as little as 3% down. FHA loans go to 3.5%. VA and USDA loans can require nothing down for eligible buyers. The 20% figure isn't a requirement — it's just the point where you avoid private mortgage insurance.
The trade-off with a smaller down payment
Put down less and you'll likely pay mortgage insurance until you build enough equity, and your loan balance (and payment) will be higher. Put down more and you lower both. Neither is 'right' — it depends on how much cash you want to keep on hand.
Buy now or save more?
Sometimes buying sooner with less down beats waiting years to hit 20% — especially if rents and prices are rising. Run your specific numbers with our calculators, and let a loan officer help you weigh the trade-offs for your goals.