Definition
Minimum down payment varies by loan program: conventional typically 3%, FHA 3.5%, VA and USDA may be 0%. Lower down payments require mortgage insurance and higher interest rates. Don't put down the minimum just because you can—larger down payments improve loan terms.
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Conventional loans typically require minimum 3% down, FHA loans 3.5%, VA and USDA loans may require 0%. Lower down payments require mortgage insurance and higher interest rates. Minimums also vary based on credit score and property type.
Pro Tip
Don't put down the minimum just because you can; saving for a larger down payment reduces insurance costs and improves loan terms.
Example
A borrower can purchase a $400,000 home with 3% down ($12,000) on a conventional loan, financing $388,000, though they'll pay PMI.