How much down payment do you need?
Reviewed August 2026
The '20% down' rule is the single most expensive myth in home buying — it keeps people renting for years unnecessarily. Here's what's actually required.
The real minimums
Minimum down payments depend on the loan:
- Conventional: as little as 3% down for many first-time buyers.
- FHA: 3.5% down with a 580+ credit score.
- VA (eligible veterans/service members): often 0% down.
- USDA (eligible rural areas): often 0% down.
What buyers actually put down
The median down payment for first-time buyers has run around 8%–9% in recent years — not 20%. Many combine a low-down-payment loan with state down-payment-assistance programs.
The trade-off of putting less down
A smaller down payment gets you in sooner and keeps cash for reserves and repairs, but it means a larger loan, a higher monthly payment, and — on conventional loans under 20% down — private mortgage insurance (PMI) until you reach about 20% equity. PMI is cancelable; FHA mortgage insurance often is not, which is why some buyers refinance out of FHA later.
Frequently asked
Is 20% down required?
No. 20% down lets you avoid PMI on a conventional loan, but many loans allow 3%–3.5% down, and some allow 0%. The median first-time buyer puts down roughly 8%–9%.
Do down payment assistance programs exist?
Yes. Most states run first-time buyer programs through a Housing Finance Agency, offering below-market loans plus down-payment and closing-cost help for eligible buyers (income and price limits apply).