How Much Down Payment Do You Need to Buy a House in 2026?

Mortgage Guides · Updated for 2026 · About an 8-minute read

If you've been saving for a home, you've probably heard that you need 20% down. It's one of the most persistent myths in home buying — and for many buyers, believing it means renting for years longer than necessary. The truth is that most people buy with far less. This guide breaks down the real minimum down payments by loan type in 2026, what a smaller down payment costs you, and the closing-cost money you'll need on top of it.

The 20% Down Payment Myth

Twenty percent down is not a requirement to buy a home. It's simply the threshold at which conventional lenders stop charging private mortgage insurance (PMI). Putting 20% down has real benefits — a smaller loan, a lower monthly payment, and no PMI — but it is a goal, not a gate.

The median down payment for first-time buyers has hovered well below 20% for years, often in the high single digits. Repeat buyers tend to put down more, largely because they roll equity from a previous home into the next purchase. If you're waiting to hit 20% before you start looking, it's worth running the numbers on buying sooner with a smaller down payment — especially if you're currently paying rent that rivals a mortgage payment.

Minimum Down Payments by Loan Type

The right loan program depends on your credit, income, service history, and where you're buying. Here are the common minimums in 2026:

• Conventional (3%): Many conventional loans allow as little as 3% down for qualified first-time buyers through programs like Fannie Mae's HomeReady and Freddie Mac's Home Possible. Standard conventional loans typically start at 5%.
• FHA (3.5%): Backed by the Federal Housing Administration, FHA loans require just 3.5% down with a credit score of 580 or higher. Scores between 500 and 579 may still qualify with 10% down. FHA is popular with buyers who have thinner credit or a higher debt load.
• VA (0%): Eligible veterans, active-duty service members, and some surviving spouses can buy with no down payment at all through a VA loan — and with no monthly mortgage insurance. There is usually a one-time VA funding fee.
• USDA (0%): The USDA Rural Development program also offers 0% down for buyers purchasing in eligible rural and many suburban areas, subject to household income limits.

Because each program prices risk differently, it pays to compare offers across loan types rather than assuming one is best. A licensed loan officer can tell you which you qualify for.

What PMI Is and How to Avoid It

When you put down less than 20% on a conventional loan, the lender typically requires private mortgage insurance. PMI protects the lender — not you — if you default, and it's added to your monthly payment. Costs vary widely with your credit score and down payment, but a common range is roughly 0.3% to 1.5% of the loan amount per year.

The good news: PMI on a conventional loan isn't forever. As you pay down the balance and your home appreciates, you can request cancellation once you reach about 20% equity, and lenders are generally required to remove it automatically at 22% equity based on the original value. FHA loans handle insurance differently — FHA mortgage insurance premiums often last the life of the loan unless you refinance out of FHA. We cover that trade-off in our guide on when refinancing makes sense.

Don't Forget Closing Costs

Your down payment isn't the only cash you'll need at the finish line. Closing costs typically run 2% to 5% of the loan amount and cover things like loan origination fees, appraisal, title insurance, and prepaid property taxes and homeowners insurance. On a $350,000 loan, that's roughly $7,000 to $17,500 on top of your down payment.

There are ways to soften the blow. Sellers can sometimes contribute toward your closing costs (called seller concessions). Some lenders offer lender credits — a slightly higher rate in exchange for covering part of your costs. Down payment assistance programs, common at the state and local level, can also help with both the down payment and closing costs for eligible buyers.

How Your Down Payment Affects the Monthly Payment

A larger down payment shrinks your loan, which lowers both your monthly principal-and-interest and — once you cross 20% on a conventional loan — removes PMI. But putting every last dollar down isn't always wise. Draining your savings can leave you without an emergency fund for the inevitable surprises of homeownership.

The smart move is to model a few scenarios. Try our free mortgage payment calculator to see how 3%, 10%, and 20% down each change your monthly payment, then decide what balance of cash cushion and monthly cost fits your budget. If a lower payment is your main goal, our guide on ways to lower your monthly mortgage payment covers several other levers beyond the down payment.

The Bottom Line

You almost certainly don't need 20% down to buy a home in 2026. Depending on the program, you may qualify with as little as 0% to 3.5% down — the key is understanding the trade-offs of PMI, closing costs, and your monthly payment, then comparing lenders to find the best overall deal for your situation.