Your down payment is the cash you bring to closing toward the purchase price of the home. It's typically expressed as a percentage of the purchase price — a 10% down payment on a $400,000 home is $40,000.

Down payment minimums vary by loan program: 3% for some conventional first-time buyer programs, 3.5% for FHA, 5% for most conventional buyers, 10–20% for jumbo and second homes, 20–25% for investment properties, and 0% for VA and USDA.

A larger down payment reduces your loan amount, your monthly payment, and your PMI/MIP. But don't drain your savings to put more down — keep 3–6 months of housing expenses in reserves, and consider what else the cash could earn elsewhere.

Related terms

Insurance

PMI

Insurance that protects the lender when you put less than 20% down on a conventional loan.

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Underwriting

LTV Ratio

The loan amount divided by the home's value, expressed as a percentage.

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Costs & Pricing

Closing Costs

The fees and charges paid at closing on top of the down payment, typically 2–5% of the purchase price.

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