ShareThisHow Much Down Payment Do You Need?
Different loans have different down payment requirements. Mortgages insured by the Federal Housing Administration (FHA) need a 3.5% down payment. Conventional loans need a least a 5% down payment.
If you are buying a $200,000 house, a 3.5% down payment would be $7,000. And a 5% down payment would be $10,000.
Sure, you can put every penny you’ve saved into your house. It will lower your payment, decrease or eliminate PMI, and protect you against decreases in the market. But you won’t be able to pull that money out of your house easily if you need it. It’s a good idea to keep some money in an emergency fund for future repairs or other surprises.
A lot of first-time home buyers will use down payment assistance programs to help with their down payment. Contact me for the details.
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