If you’re wondering how much to put down on a house, the answer depends on more than your savings balance. The national median down payment in Q2 2026 was 13.7% of the purchase price, according to Realtor.com.
The right number for you depends on your loan type, your savings cushion, your local market, and whether avoiding private mortgage insurance (PMI) is worth the extra cash upfront. There’s no universally correct answer, but there is a smart way to find yours. This guide walks through each factor so you can set a down payment target that fits your full financial picture.
Key takeaways
- Median is not the rule. First-time buyers put down a median of 10% and repeat buyers put down 23%, according to NAR’s 2025 Profile of Home Buyers and Sellers. Neither figure is a requirement.
- 20% avoids PMI. Putting less than 20% down on a conventional loan triggers PMI, but PMI can be removed once your balance reaches 80% of the home’s original value.
- Loan type sets your floor. VA and USDA loans allow 0% down for eligible borrowers. FHA starts at 3.5%, and some conventional programs start at 3%.
- Cash reserves matter. A bigger down payment only helps if it doesn’t empty your savings account the week after closing.
- Assistance exists. State housing agencies, local programs, and nonprofit grants can help bridge the gap when savings fall short.
- Start with a lender early. Knowing your credit score, debt-to-income ratio, and eligible loan programs before you shop makes your target concrete.
What do most homebuyers actually put down in 2026?
According to the National Association of Realtors’ 2025 Profile of Home Buyers and Sellers, the most recent national breakdown by buyer type, first-time buyers put down a median of 10% and repeat buyers put down 23%. For 2026 transactions, Realtor.com reports a national median down payment of 13.7% of the purchase price in Q2 2026, up from 12.8% in Q1.
The key word in all of those figures is “median.” They describe the middle of the pack, not a target or a requirement. If you’re a first-time buyer heading toward 10% down, you’re right in line with the national picture. Many buyers close with 3.5% or 5% down using FHA and low-down-payment conventional programs, then build equity from there.
Your local market changes the math, too. The percentage may be the same, but the savings challenge is not: 10% down on a $300,000 home is $30,000, while 10% down on a $700,000 home is $70,000. Anchoring on a dollar amount tied to your target price range is more useful than chasing the national median.
Minimum down payment by loan type
Before you pick a target, know what your loan type requires. Minimums vary widely, and the right program for you depends on your service history, income, location, and credit profile.
Zero down doesn’t mean zero cash at closing. VA and USDA borrowers still need funds for closing costs, inspections, prepaid taxes and insurance, and earnest money, so budget for those separately from your down payment.
Is 20% down still the rule?
The 20% rule exists because it’s the threshold that eliminates PMI on a conventional loan. It’s a real financial lever, but it isn’t a requirement, and for many buyers it isn’t the right move. Whether it makes sense depends on your timeline, your other savings goals, and how quickly PMI would come off.
PMI on a conventional loan typically runs from about 0.3% to 1.5% of the loan amount per year. Your exact rate depends mainly on your credit score and your loan-to-value (LTV) ratio. A borrower with strong credit at 90% LTV will generally pay much less than a borrower with a lower score at 95% LTV.
PMI on a conventional loan isn’t permanent. Under the federal Homeowners Protection Act, you can ask your servicer in writing to cancel PMI once your balance reaches 80% of the home’s original value, as long as you have a good payment history and meet your servicer’s other requirements, which may include an appraisal. Your servicer must cancel it automatically when your balance is scheduled to reach 78% of the original value. Many conventional loans also allow PMI removal based on a new appraisal if your home has gained value.
FHA works differently. With less than 10% down, FHA mortgage insurance lasts for the life of the loan. With 10% or more down, it drops off after 11 years.
Finally, draining your savings to reach 20% can leave you in a fragile spot after closing. If the HVAC fails in month three or your income dips, having no cushion is a real problem. The best down payment reaches your PMI or program threshold without leaving your savings at zero.
What else should factor into your decision?
Monthly payment math and PMI thresholds matter, but two other factors carry real weight: your cash reserves after closing and how competitive your local market is.
Cash reserves after closing
Financial planners commonly recommend keeping three to six months of living expenses in liquid savings. Closing on a home shouldn’t wipe that out. The best down payment hits your target without leaving you exposed to the first surprise expense of homeownership.
Down payments in competitive markets
In a multiple-offer market, a larger down payment signals financial strength and can make your offer more attractive, even at the same price. In slower markets, it matters less. Buyers in high-demand areas often aim for 10% or more even when they qualify for less, simply to strengthen their offer. Ask your agent what’s typical where you’re buying.
There’s also a rate connection. Lenders price loans in LTV tiers, so a lower LTV can sometimes earn a slightly better interest rate. Moving from 95% to 90% LTV usually won’t change your rate dramatically, but it’s one more reason a little more than the minimum can pay off over time.
At Blue Arrow Lending, we walk through LTV tiers and their rate impact with borrowers early, so you’re not guessing at these tradeoffs once you’re under contract.
What to do when your savings fall short
If your savings aren’t at your ideal down payment yet, you have real options to explore before assuming you need to wait.
Down payment assistance programs exist at the federal, state, county, and city level. Common structures include outright grants, forgivable second mortgages that go away after a required occupancy period, and deferred-payment loans that come due when you sell or refinance. Your state housing finance agency is the best starting point, and many programs can be paired with FHA or conventional loans to reduce the cash you bring to closing.
Typical eligibility requirements include:
- First-time buyer status, which usually means you haven’t owned a primary residence in the past three years
- Household income at or below program limits, often 80% to 120% of area median income
- Primary residence occupancy (investment properties and vacation homes don’t qualify)
- A minimum credit score, commonly around 620 when paired with a conventional loan
- Completion of an approved homebuyer education course before closing
Program funding changes often, so early research matters. A loan officer who works with these programs can screen your eligibility based on your income, credit, location, and price range before you start your search.
Set your target and move forward with confidence
Deciding how much to put down on a house is less about hitting a specific percentage and more about balancing PMI, monthly payment comfort, cash reserves, loan program eligibility, and what your local market rewards. The 20% benchmark is a useful reference point, not a requirement. Many buyers close successfully with 3.5%, 5%, or 10% down, and some eligible buyers close with no down payment at all.
Run the numbers for your specific price range: compare the monthly payment at each down payment option and estimate when PMI would come off in each scenario. Then get pre-approved so you know exactly where you stand on credit, DTI, and eligible loan programs before you make an offer.
Frequently Asked Questions
No. Every FHA loan carries mortgage insurance (MIP). With less than 10% down, it stays for the life of the loan. With 10% or more down, it drops off after 11 years. Many borrowers later refinance into a conventional loan to remove it once they have enough equity.
No. VA and USDA borrowers still need funds for closing costs, inspections, prepaid taxes and insurance, and earnest money. Budget for those separately from your down payment.
Financial planners commonly suggest three to six months of living expenses in liquid savings. Keeping that cushion protects you if a major repair comes up or your income is interrupted. Some loan programs also require a certain amount of reserves to qualify.
Yes. Many assistance programs can be paired with FHA or conventional loans to reduce the cash you bring to closing. Eligibility typically depends on first-time buyer status, income limits, primary residence occupancy, and completing a homebuyer education course. Your state housing finance agency is a good starting point.
Broker/Owner of Blue Arrow Lending with 13 years of experience originating mortgages. Jenn helps buyers in Colorado, Florida, Texas, and Wyoming find the right loan and down payment strategy.
This article is for general educational purposes only and is not a commitment to lend. Loan program requirements, down payment minimums, and mortgage insurance rules are general guidelines and are subject to change. All loans are subject to credit approval, underwriting, and property eligibility. Blue Arrow Lending, NMLS# 2046633. Jenn Moretti, NMLS# 573143. Licensed in Colorado, Florida, Texas, and Wyoming. Equal Housing Opportunity.