How Much Money Do I Have to Put Down to Buy a House?

In the past, lenders traditionally required a down payment of at least 20% of the purchase price of a home. Today, many lenders offer loans with lower down payments. In addition, certain private and government entities have low down payment programs.

You may be able to get a Federal Housing Administration (FHA) mortgage with a down payment of as little as 3.5%. Qualification standards for FHA mortgages are sometimes less stringent than traditional mortgage loans and the terms of these mortgages are generally attractive, making them ideal for first-time homebuyers. Keep in mind, however, that FHA loans require borrowers with down payments of less than 20% to pay mortgage insurance premiums.

Department of Veterans Affairs (VA) mortgages are another low down payment option. VA mortgages are available to qualified veterans and their surviving spouses. VA mortgage terms are also generally very attractive, and in many cases, little or no down payment is required.

You may be able to obtain a conventional mortgage with a down payment of less than 20% with the help of private mortgage insurance (PMI). Low down payment mortgages are somewhat risky for lenders, because they believe you are more likely to default on a loan in which you have very little invested. For this reason, lenders generally require PMI if you are borrowing more than 80% of the value of the home you are purchasing (i.e., your down payment is less than 20%).