The 20 percent rule is a leftover from a different era. Most qualified buyers can purchase with a fraction of that. The right minimum for you depends on the loan program, the home, and what owning it will cost you on top of the mortgage.
Conventional loans can start as low as 3 percent down for many qualified first-time buyers, and 5 percent for many other scenarios. FHA is 3.5 percent. VA is 0 percent for eligible service members and veterans. USDA is 0 percent in eligible rural areas for qualified buyers. Jumbo and investment property loans typically require meaningfully more.
These numbers are about qualifying. Whether you should put more down is a separate question.
Less down means a higher loan balance, a higher monthly payment, and usually some form of mortgage insurance until you build enough equity. On a conventional loan, private mortgage insurance typically falls off automatically once you reach 22 percent equity. On FHA, mortgage insurance often stays for the life of the loan unless you refinance.
Less down also keeps cash in your pocket for closing costs, moving, repairs, and the first round of unexpected expenses that every new homeowner runs into.
Plan for closing costs separate from your down payment. Depending on your state and loan, these typically run 2 to 5 percent of the loan amount. There are programs that allow seller credits or lender credits to offset some of this. Bring it up before you write your offer, not after.
A practical checklist with true monthly-payment math, loan choices, cash-to-close planning and a fillable buying worksheet.
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