Definition
Most lenders require a minimum down payment—often 3-20% depending on the loan type. A higher down payment often means better loan terms and no mortgage insurance requirement.
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Conventional: 5-20%+. FHA: 3.5%. VA: 0%. USDA: 0%. Lower down payments require mortgage insurance. Higher down payments reduce monthly payment. Lender determines requirements. Borrower qualification affects requirement. Competitive offers benefit from higher down payment. Down payment is key cost component. Savings/borrowing decisions impact purchase timing. Seller takes back second mortgage rarely. Professional guidance on optimal down payment valuable. Balancing liquidity vs. mortage cost.
Pro Tip
20% or more down eliminates mortgage insurance, which saves you money monthly. Evaluate whether waiting to save more is worth delaying your home purchase.
Example
20% down payment of $100,000 qualified for conventional financing without mortgage insurance.