Forget about the myth that you have to put 20% down to buy a home. The reality is you don’t. The average down payment on a house is far less. Also, depending on whether you’re a first-timer scraping together every spare dollar or a repeat buyer with ample equity from a recent home sale, your down payment strategy is likely to look completely different.
So how much should you put down on a house? Here’s what the latest industry data reveals about what people are actually putting down, what common mortgage programs require and what it all means for you.
Key Takeaways:
- A home’s down payment is a percentage of the seller’s asking price that is paid by the buyer at closing.
- According to 2025 industry data, U.S. buyers overall put down a median of 19%, while first-time buyers made a median 10% down payment on their home purchase, an all-time high.
- Repeat buyers put down a median of 23%, the highest for that group since 2003.
- Different loan programs have varying down-payment minimums, which can make a big difference in what you need to bring to the table.
What Are Buyers Actually Putting Down On Homes?
U.S. buyers overall made a median down payment of 19% of a home’s purchase price in 2025, while first-timers made a 10% median down payment, according to the National Association of REALTORS® (NAR) 2025 Profile of Home Buyers and Sellers. This iteration of the annual survey was conducted with buyers who bought a home between July 2024 and June 2025.
As of the fourth quarter of 2025, the median home sale price in the U.S. was $405,300, according to the Federal Reserve Bank of St. Louis. That translates to a median down payment for all U.S. buyers of about $77,000.
Down Payments By Buyer Category
| Buyer Type | Median Down Payment % | Median Age | Dollar Amount |
|---|---|---|---|
| All Buyers | 19% | 59 years old | ~$77,000 |
| First-Time Buyers | 10% | 40 years old | ~$40,500 |
| Repeat Buyers | 23% | 62 years old | ~$93,200 |
These down payment percentages represent historic highs for both groups. However, the median age of a first-time buyer is now 40, NAR found, which is a significant rise from the late 20s average seen in the 1980s. One likely reason: Home prices have also soared in recent years, significantly outpacing household income growth, making it harder for younger buyers to save up for a home.
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What Influences Your Down-Payment Amount?
Your down payment isn’t just about how much you’ve saved. Here are other key factors that influence the amount you’ll bring to the table.
1. Loan Type
Different mortgage programs have various minimum down payment requirements. Here are the main types and their respective guidelines.
Conventional Loans: 3% or 5%
Conventional loans, which are bought and sold by Fannie Mae and Freddie Mac, are widely available from most lenders and tend to have competitive interest rates and fees for buyers with higher credit scores. You can put as little as 3% down for certain first-time buyer programs through Fannie Mae’s HomeReady or Freddie Mac’s Home Possible program. Repeat buyers typically need 5% down.
FHA Loans: 3.5%
FHA loans are insured by the U.S. Federal Housing Administration and require just 3.5% down for borrowers with credit scores of 580 or higher. If your score is between 500 – 579, you’ll need 10% down. An FHA loan is an ideal option if you don’t have stellar credit or robust savings. The catch? You’ll pay steeper FHA mortgage insurance premiums (MIPs), paid both up front and then annually, usually for the life of the loan.
VA Loans: 0%
Backed by the U.S. Department of Veterans Affairs, VA loans have a major perk: zero down payment. However, to qualify for one, you have to be an eligible veteran, active-duty service member or surviving spouse. If you are, you’ll access competitive rates and have no required ongoing mortgage insurance either – though there is a one-time VA funding fee (which may be waived in some cases).
USDA Loans: 0%
There’s no down payment for USDA loans, which are backed by the U.S. Department of Agriculture, but you must be buying a property in an eligible rural area and meet a strict income limit of 115% of the median area income limit to qualify for this financing.
Jumbo Loans: 10%
If you’re buying a home that exceeds conforming loan limits, you’ll likely need a jumbo loan. As of 2026, the conforming loan limit is $832,750 in most areas of the U.S. Expect to put down 10% or more of the purchase price. These loans also require a higher credit score, cash reserves and a strong income to qualify, and not all lenders offer them.
2. Credit Score
Your credit score doesn’t just affect your interest rate; it can also determine your down payment. With an FHA loan, for instance, a score below 580 bumps up your minimum down payment to 10% from 3.5%.
With conventional loans, a stronger credit score (typically 620 or higher) is needed, and a score of 740 or more usually unlocks the best rates and terms. This can also lower the down payment required to secure an affordable mortgage. Check your credit score before you start your home search, and be sure to address any errors.
3. Private Mortgage Insurance (PMI)
Remember that 20% down payment legend? Here’s where that number comes from: Putting down 20% or more gets you out of paying private mortgage insurance (PMI), a monthly cost that typically runs between 0.1% – 2% of your loan amount annually. On a $300,000 mortgage, that’s an additional $25 – $500 per month on top of your principal and interest.
Don’t fret, though: PMI doesn’t have to be forever, even if you can’t put 20% down. It cancels automatically once your loan-to-value ratio (LTV) hits 78%. Even better: You can request cancellation as soon as you reach 20% equity, as your home’s value increases and you pay down your loan balance.
With FHA MIP, however, you’re tied to paying annual premiums for the life of the loan with just 3.5% down. Upfront MIP is 1.75% of the loan amount, while annual MIP ranges from 0.15% – 0.75% and ends after 11 years if you put down 10% or more.
4. Market Conditions
In hot markets with bidding wars galore, some buyers up the ante by putting more money down to make their offer stand out. A larger down payment shows sellers you’re a serious buyer who has the financial strength to follow through on a purchase.
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Mortgage Payment Examples: What Does Your Down Payment Actually Cost Each Month?
Let’s look at what different down payment amounts mean for a $400,000 home with a 6.5% interest rate on a 30-year fixed mortgage.
| Down Payment % | Amount Down | Loan Amount | Est. Monthly Principal and Interest | Est. Monthly PMI |
|---|---|---|---|---|
| 3% | $12,000 | $388,000 | $2,452 | $356 |
| 3.5% | $14,000 | $386,000 | $2,440 | $354 |
| 10% | $40,000 | $360,000 | $2,275 | $132 |
| 20% | $80,000 | $320,000 | $2,023 | N/A |
The difference in your monthly principal and interest payment between a 3% and a 20% down payment is about $429 per month (or $5,148 annually). And that’s before factoring in the monthly $356 PMI savings, or another $4,272 per year.
But if saving up for a 20% down payment would require additional years of renting, you might still come out behind, due to home price appreciation and the equity you could’ve built in the meantime. Your rent could always go up, too, further limiting how much you can save.
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Where To Turn For Down-Payment Assistance
You may not realize it, but there’s a lot of help out there for buyers. By the end of 2025, there were 2,619 down-payment assistance (DPA) programs nationwide, and all U.S. counties have at least one, according to Down Payment Resource. The nationwide average benefit is roughly $18,000.
Down-payment assistance comes in a few options:
- Grants: This DPA is free money that doesn’t have to be repaid as long as you meet program requirements and follow the terms of the grant.
- Forgivable loans: Technically second mortgages, these loans are typically forgiven after 5 – 15 years, depending on the program, as long as you stay in the home and make on-time payments. Walk away early, however, and you’ll owe a prorated amount.
- Deferred loans: With this assistance, no payments are required until you sell, refinance or move. It’s great for buyers who need cash now but expect to have more later.
- Low-interest second mortgages: You borrow extra for the down payment and repay it separately, usually at below-market rates, with a second-lien home loan. This adds to your overall mortgage debt, however, and puts your house at greater risk of foreclosure if you default on payments.
Most DPA programs come with a few catches: first-time buyer requirements, area income limits, minimum credit scores and completion of a home-buyer education course. In some cases, you may have to agree to live in the home for a set time period – or repay the amount borrowed.
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How To Budget For Your Down Payment
It’s never too late to start saving for your down payment. Here are some strategies to consider:
- Open a dedicated high-yield savings account (HYSA). Keeping your down payment funds separate from the rest of your money can help you avoid the temptation to dip into it. A HYSA also helps your money grow through the magic of compounding while you wait.
- Automate your savings. Set up automatic transfers on payday for your future home fund. Ideally, you’ll put that money into a HYSA, but regardless of the account, taking a set-it-and-forget-it approach can help keep your savings goals on track.
- Check your DPA eligibility early. Search for and visit your state’s housing finance agency to find programs you might qualify for. Apply early, as some programs have wait lists or limited funding.
- Consider a smaller down payment sooner. If home prices are climbing in your area, buying with 5% or 10% today and paying PMI for a few years might beat waiting to save up 20% while home prices continue to rise beyond your reach.
- Opt for a less expensive home. Even if you can afford the top end of your budget, consider a home that’s more affordable to help lower the down payment you’ll need at the closing table.
- Be careful about tapping retirement accounts. Withdrawals can come with tax implications and steep penalties if you’re under age 59½. Consult with a financial advisor before making any moves; some plan types allow for penalty-free withdrawals for first-time home buyers, but the rules are particular.
- Budget for other costs. Don’t forget that besides your down payment, you’ll also owe closing costs, which are generally 3% – 6% of the loan amount, along with annual home insurance premiums and property taxes, moving expenses, utilities, homeowners association dues (if applicable) and ongoing home maintenance. Experts recommend budgeting at least 1% – 4% of your home’s purchase price annually for maintenance.
FAQ
The Bottom Line: 20% Down Is A Myth; Do Your Own Math
Median down payments are near historic highs, but how much you end up putting down is all about math. While various loan programs have their own minimum guidelines, doing your own number crunching will let you see how much you can comfortably afford now and how that pencils out in monthly costs as a new homeowner.
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Deborah Kearns
Deborah Kearns is an award-winning independent journalist with more than 15 years of experience covering real estate, mortgages and personal finance. Her work has appeared in the Wall Street Journal, Kiplinger, U.S. News & World Report, Quartz, CNN, Forbes, Fortune, Newsweek, The Associated Press and dozens of other outlets. She previously led content and communications at a Top 15 national mortgage company and held writing and editing roles at Bankrate, NerdWallet, LendingTree and RE/MAX. She holds a bachelor's degree in journalism from the University of Florida and a master's degree in public relations from Ball State University.
