How Much Money Do You Need for a Down Payment on a House?

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If you’re looking to beat the expected interest rate hikes and buy a home right now, you may be wondering if you have enough money for a down payment.

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Conventional mortgages typically require a 20% down payment. So if you are buying a $200,000 home, you’d need at least $40,000 for your down payment. You will also need to factor in closing costs, which typically total 3% to 6% of the home’s purchase price, according to Rocket Mortgage. However, closing costs can vary based on a number of factors, including property taxes and any points (upfront payments that can reduce your interest rate) on the mortgage.

Putting 20% down for your mortgage can help ensure you get the best interest rates, as long as you have a good or excellent credit score. A 20% down payment also helps you avoid private mortgage insurance, or PMI. Most lenders require PMI if your mortgage is greater than 20% of the home’s value.

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Some mortgages don’t require a 20% down payment. FHA loans, for instance, may require as little as 3.5% down for qualified borrowers. Some VA loans, which are guaranteed by the U.S. Department of Veteran Affairs, may have no-money-down options for qualified veterans, current military service members, and their spouses.

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About the Author

Dawn Allcot is a full-time freelance writer and content marketing specialist who geeks out about finance, e-commerce, technology, and real estate. Her lengthy list of publishing credits include Bankrate, Lending Tree, and Chase Bank. She is the founder and owner of, a travel, technology, and entertainment website. She lives on Long Island, New York, with a veritable menagerie that includes 2 cats, a rambunctious kitten, and three lizards of varying sizes and personalities – plus her two kids and husband. Find her on Twitter, @DawnAllcot.


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