Credit and Mortgage Information December 13, 2023

How Much Down Payment Do I Need?

Getting your finances in order is vital when preparing to purchase a home. If you’re looking to buy a house, one of the first things you’ll need to consider is how much down payment you’ll need to make. 

Depending on the type of loan you’re applying for, the size of your down payment could vary.

Generally, most conventional loans will require at least a 5% down payment. Some government-backed loans, like FHA or VA loans, may allow for a down payment as low as 3.5%. And if you’re eligible for a USDA loan, your down payment could be as low as 0%.

Of course, the size of your down payment isn’t the only factor affecting your home buying experience. You’ll also need to consider your credit score and the current market conditions.

So, how much down payment do you need to buy a home? As we indicated above, the answer depends on various factors, but you’ll need at least 5% in most cases. Keep in mind, though, that the size of your down payment also affects the competitiveness of your offer.  

A high down payment shows the seller you’re serious about buying the home. It also demonstrates that you have the financial resources to follow through on the purchase. This advantage can be significant in a competitive market, where the seller may have to choose from several offers.

A high down payment also gives you more leverage in negotiations. If the seller knows you’re willing and able to put more money down, they may be more likely to accept your offer – even if it’s not the highest one.

So, if you have the means, a high down payment is always the best way to go when buying a home. It will make your offer more attractive to the seller, lower the amount you need to borrow, and give you more negotiating power. Just be sure you have a solid plan for how you’ll finance the rest of the purchase.

If you’re interested in learning more about low-down-payment options, there are several places to go. 

There are programs for qualified buyers with down payments as low as 3.5%. There are also options like VA and USDA loans with no down payment requirements for qualified applicants.

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 Be sure to also work with a real estate advisor from the start to learn what you may qualify for in the home buying process.  

Call me. I can put my years of experience to work and point you in the right direction!

Kim Shaw

(928) 710-9148