Many lenders recommend a down payment of at least 20%, so you won’t have to factor in mortgage insurance for your monthly payments. Larger down payments also generally lead to lower interest rates, meaning you end up paying less for your mortgage in the long run. However, 20% doesn’t always need to be the go-to number and many loan programs support down payments as low as 3%. In fact, according to a survey conducted by Country Financial in 2019, more than 50% of buyers surveyed put down less than 10% on their home purchase. What you end up paying out-of-pocket for your down payment varies—it depends on your financial circumstances, whether you currently rent or own your existing home, and the requirements based on the type of loan you select. Our down payment calculator can help you crunch the numbers and find that sweet spot, but a licensed loan originator can show you the right down payment and loan product for your financial situation.

There are many factors that you should consider when deciding on what loan program is right for you, such as your down payment amount, credit score, your location, requested loan amount, and more. You should decide on a loan that makes the most financial sense for your home purchase. If making a 20% down payment with a conventional loan would run your savings dry, a lower down payment with PMI might be your best option. Or perhaps an FHA loan may work out better for you. Talk through your options with your lender and consult a trusted financial advisor before deciding on a home loan.