Published: 2026-09-28
The down payment you need depends on the loan program, the lender's own rules, and the price of the home. There is no single national minimum that fits every buyer.
The useful figure is the cash to close on a written estimate for a specific loan. Program minimums change, so treat the structures below as common designs, not as a quote.
How much cash counts as the down payment?
The down payment is the part of the price you pay up front so you borrow less than the full price. Lenders call the borrowed share the loan-to-value ratio.
As plain arithmetic, 3 percent of a $100,000 price is $3,000, and 20 percent is $20,000. That example is only math, not a quote. A smaller down payment means a larger loan, and it can add mortgage insurance or a program fee.
Rates and loan terms vary by lender, credit, property, and market conditions. This is educational information, not a loan offer or advice.
What do conventional loans usually require?
A conventional loan is one that is not insured by FHA and not backed by VA or USDA. The down payment depends on which conventional product you use.
Fannie Mae publishes products, including HomeReady, with a down payment as low as 3 percent for borrowers who meet that product's rules. The current description is on Fannie Mae's HomeReady page. Other conventional loans ask for more. A lender can set a higher floor than the investor guide.
The Consumer Financial Protection Bureau says borrowers who put down less than 20 percent of the purchase price typically pay mortgage insurance. On a conventional loan, that charge is usually private mortgage insurance. It protects the lender, not you.
On many conventional loans you can ask the servicer to cancel borrower-paid PMI once the balance is scheduled to reach 80 percent of the home's original value, if you meet the conditions. Servicers generally must end that PMI when the balance is scheduled to reach 78 percent, if your payments are current. The CFPB explains both steps in its PMI cancellation answer. FHA mortgage insurance uses different rules. Do not assume the same calendar.
What does an FHA loan ask for up front?
HUD says an FHA down payment can be as low as 3.5 percent of the purchase price. That line is on HUD's loans page. FHA insures the loan. A private lender still makes the decision and can apply stricter rules.
HUD Handbook 4000.1 ties the minimum cash investment to the credit score. A score of 580 or higher is the band tied to the 3.5 percent minimum. A score from 500 to 579 is tied to a higher minimum, generally 10 percent. Scores under 500 are generally not eligible for standard FHA insurance. HUD revises the handbook. Confirm the current page, and ask the lender which score floor it actually uses. Many lenders will not go down to the handbook floor.
FHA loans also charge mortgage insurance premiums. How long the annual premium lasts depends on the loan. That cost is separate from the down payment.
What about VA and USDA loans?
VA does not require a down payment on a VA-backed purchase. VA's loan page says lenders may still require one for some borrowers, and that nearly 90 percent of VA-backed loans are made with no down payment. You still need eligible service, a Certificate of Eligibility in the usual case, enough income, and credit the lender will accept.
VA-backed purchase loans do not use private mortgage insurance. A VA funding fee often applies unless you are exempt. The fee changes with service details, down payment, and prior use of the benefit. Financing the fee is not the same thing as skipping a down payment the lender required.
USDA's Single Family Housing Guaranteed Loan Program helps approved lenders offer 100 percent financing to eligible buyers. That structure has no down payment when you and the property qualify. The home must sit in an eligible rural area, and household income must fall within USDA limits. A house that looks rural to you can still fail the map.
USDA publishes an upfront fee and an annual fee on that program. The amounts change. They are program costs, not a down payment and not a rate quote.
What other cash do you need at closing?
The down payment is one line on the closing statement. You also pay closing costs, and you often deposit months of property taxes and homeowners insurance.
Closing costs include lender charges, the appraisal, and title work. A seller contribution or a lender credit can cover some of them, up to a cap that depends on the loan. Get the cash-to-close number from a Loan Estimate.
Earnest money you already paid is often credited toward what you bring. Some loans also require reserves, meaning months of payments left in the bank after closing. Reserves are not the down payment, and you still have to show them.
Can someone else supply the down payment?
Often yes, if the program allows the source and the lender can document it. On a one-unit HomeReady purchase, Fannie Mae does not require a minimum share from the borrower's own funds, and gifts are allowed. Other products can require some of your own cash. Ask the lender before anyone moves the money.
City, county, and state programs sometimes help with down payment or closing costs. A HUD-approved housing counselor can tell you what is open where you want to buy. Aid can come with a class, income limits, or a second lien.
The first-time homebuyer guide on HomeMortgageOnline walks from budget to keys. The payment and cash-to-close calculators on HomeMortgageOnline let you test a monthly number against a down payment you might actually have. The site does not take applications or lock rates.
Closing costs sit on top of the down payment. See Closing Costs: Who Pays What When You Buy.
Disclaimer: this guide is for general education. HomeMortgageOnline is not a lender, broker, or loan originator. It does not take applications, lock rates, or give financial advice. Real offers vary by credit, down payment, loan type, points, fees, and market conditions.
Sources
- Fannie Mae's HomeReady page - https://singlefamily.fanniemae.com/originating-underwriting/mortgage-products/homeready-mortgage
- Consumer Financial Protection Bureau - https://www.consumerfinance.gov/ask-cfpb/what-is-mortgage-insurance-and-how-does-it-work-en-1953/
- its PMI cancellation answer - https://www.consumerfinance.gov/ask-cfpb/when-can-i-remove-private-mortgage-insurance-pmi-from-my-loan-en-202/
- HUD's loans page - https://www.hud.gov/helping-americans/loans
- HUD Handbook 4000.1 - https://www.hud.gov/program_offices/housing/sfh/handbook_4000-1
- VA's loan page - https://www.va.gov/housing-assistance/home-loans/loan-types/
- Single Family Housing Guaranteed Loan Program - https://www.rd.usda.gov/fact-sheet/single-family-housing-guaranteed-loan-program