How Much Down Payment Do You Need?
Calculate your down payment amount by home price and percentage. See how down payment affects your monthly payment and PMI.
Down Payment Options
20% down: No PMI required, best rates, strongest offer in competitive markets. On $400K: $80,000. 10% down: PMI required ($100-200/month), good middle ground. On $400K: $40,000. 5% down: Conventional minimum, higher PMI. On $400K: $20,000. 3.5% down: FHA minimum. 0% down: VA (veterans) and USDA (rural) loans.
Is 20% Down Always Best?
Not necessarily. If saving to 20% takes 5+ extra years of renting, the opportunity cost (home appreciation you miss) may exceed the PMI savings. In a market appreciating 5% per year, a $400K home gains $20,000/year — waiting 3 extra years to save from 10% to 20% down means missing $60,000 in appreciation while paying $54,000 in rent (at $1,500/month). The math often favors buying sooner with less down.
First-time homebuyer programs in many states offer down payment assistance of $5,000-25,000 as grants or forgivable loans. The FHA also allows gift funds for the entire down payment from family members. Research your state housing finance agency before assuming you need to save the full amount yourself.
