Buying a Home September 25, 2023

You May Be Wrong About Your Down Payment Needs

Are you in the market for a home but feel your dream is out of reach? The uncertainty may be because you feel like you need to have a substantial down payment saved up to qualify. Well, guess what – there’s good news! You may not need as much money as you initially thought. Conventional wisdom regarding the down payment necessary for buying a home may be wrong – and we can tell you exactly why!  

Freddie Mac states, “The most damaging down payment myth—since it stops the homebuying process before it can start—is the belief that 20% is necessary.” 

Generally speaking, you will need between 5% and 20% of the home’s purchase price for a down payment. The National Association of Realtors (NAR) reported that the median down payment hasn’t been over 20% since 2005. Today, the median down payment is only 13%, with first-time homebuyers’ median down payment only 7%.

However, some programs can help you with as little as 3% down. For example, the Federal Housing Administration (FHA) offers a 3.5% down payment program, and the Department of Veterans Affairs (VA) and the United States Department of Agriculture (USDA) offer programs with 0% down.

What Does This Mean for You?

Larger down payments have their benefits, mainly providing lower mortgage rates and monthly payments. But if you can’t swing a 20% down payment, don’t worry! To understand your options, you need to do your homework. If you want to learn more about down payment assistance programs, information is available through sites like 

Assistance Programs

According to, thousands of financial assistance programs, like affordable mortgage options for first-time buyers. Down payment assistance options make up the majority of the many available programs. According to their information, 73% of the assistance available to homebuyers is there to help you with your down payment. 

Tips to Save for Your Down Payment

There are some ways to help save that money for your down payment. Each month, pretend you already have a mortgage payment and have that amount deposited into savings. Once you have saved enough for your down payment, you can use that money as extra payments on your mortgage to help pay it off faster! Another tip is to get creative with your living situation. Move from a two-bedroom apartment to a one-bedroom, or consider a temporary roommate. Apply the additional income towards savings. 

Saving for your down payment may seem daunting, but remember that you don’t have to go at it alone. Call me, and I can answer your questions and start your homebuying journey today!


Kim Shaw

(928) 710-9148