Saving for a down payment is one of the most important things to do when buying a house. However, many buyers worry about how much they need to put down and how that amount compares to other buyers.
The truth is that down payment amounts depend on a lot of factors, including your location, credit history, and the type of mortgage you’re eligible for. We’ll break down how much of a down payment you need on a house, the average down payment for a house in 2025, and the benefits and drawbacks of a large down payment versus a small one.
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What is a down payment?
A down payment on a home is a percentage of the purchase price that you pay upfront with cash. The remainder of the home’s purchase price is usually covered by a mortgage. So, if the property costs $350,000, you might pay $50,000 in cash and get a mortgage loan for $300,000.
A down payment is often a requirement for getting approved for a mortgage. It’s one of the most important steps toward buying a house.
Your down payment also gives you instant equity in your home. In other words, you’ll own whatever amount of your home that you’ve covered through a down payment. This equity can be helpful, especially if you need to apply for a loan in the future and want a competitive interest rate.
How much is a down payment on a house?
Down payment amounts usually range from 0% to over 20%. A small down payment is considered anything under 10%, while a large down payment is over 20%. The amount you put toward your down payment will depend on your personal financial circumstances, the type of mortgage you’re applying for, and your lender’s requirements.
Keep in mind that for conventional loans, if your down payment is less than 20%, you’ll be required to purchase private mortgage insurance (PMI). PMI protects lenders in case you default on your mortgage. PMI is usually added onto your monthly mortgage payments and typically costs around 0.5% to 2% of the borrowed amount. However, your actual rate will depend on your credit score, your local market, and the mortgage type.
Average down payment for a house in 2025
According to the National Association of Realtors (NAR), the average down payment for a house in 2025 is 14.4%.[1] That works out to a median down payment of $30,250. Down payments have been growing steadily in recent years, but they vary widely depending on location, loan type, and other factors.
For example, down payments for rental properties and second homes are much higher, at 27.4% on average. Similarly, regional variations are significant. The typical homebuyer in San Francisco puts down 26.4%, whereas buyers in Virginia Beach, Virginia, put down an average of just 3%.[2]
Down payment requirements by loan type
Mortgage down payment requirements can vary a lot depending on the type of loan you’re applying for. Note that while the minimum requirement may be very low, many homebuyers opt for a higher down payment to benefit from lower mortgage payments.[3]
| Loan type | Minimum down payment | Notes |
|---|---|---|
| Conventional loan | 3% | PMI (~0.5%–2%) required for down payments under 20%. |
| FHA loan | 3.5% (FICO score above 580) or 10% (FICO score between 500 and 579) | Requires mortgage insurance premiums of 0.15% to 1.75%.[4] |
| VA loan | 0% | Only available to eligible veterans and service members. |
| USDA loan | 0% | Only available in eligible rural and suburban areas. |
| Jumbo loan | 10% to 20% | Varies depending on the lender. |
| Investment/Second property | 20% to 25% | Varies by lender. Higher minimums if non-owner occupied. |
Pros and cons of large vs. small down payments
One of the biggest considerations when saving up for a down payment is choosing between a large or small amount. Here are some factors to consider when deciding how much money to put down on a home.
Large down payment
A large down payment is often considered anything above 20%, especially if you’re applying for a conventional loan. For investment and secondary properties, 20% is usually considered the minimum required amount.
Pros
- No need for private mortgage insurance (PMI): If your down payment is above 20% for a conventional loan, you won’t be required to purchase PMI, which can otherwise add around 0.5–2% of the purchase price to your monthly payments. Note that for FHA loans, mortgage insurance premiums (about 0.15–1.75%) are required regardless of the down payment amount.
- Lower monthly payments: Your monthly mortgage payments will be lower the more money you can put down upfront. In addition to not having to pay PMI, your total outstanding balance will be lower, and you’ll often be able to qualify for better interest rates.
- More competitive offer: In competitive markets, a higher down payment will help your offer stand out. Many sellers view buyers with higher down payments as more financially stable and more likely to get approved for a mortgage.
- Reduced risk: Because you’ll have instant equity in your home, you’ll have a financial cushion in case home prices fall or you encounter difficulties later on. The higher your down payment amount, the less likely you’ll end up being underwater on your mortgage (i.e., owing more than what your home is worth).
Cons
- Substantial upfront savings: Trying to save more than 20% of a home’s price isn’t realistic for many buyers. The median sale price for homes sold in the U.S. is $416,900, meaning that, on average, a 20% down payment would require you to save over $83,000.[5]
- Delay homeownership: Saving up for a large down payment takes time, which means you’ll have to delay homeownership. That delay can have a potential knock-on effect on life goals, such as marriage or having children.
- Less cash for emergencies: By putting so much money into a down payment, you’ll have less liquid cash on hand in case of emergencies. While you can use equity in your home to more easily qualify for a loan, doing so will cost you in fees and interest.
- Lost investment opportunities: Home prices can fluctuate and don’t always provide the best investment opportunities. You could use the money you saved up for a down payment for potentially higher returns elsewhere, such as in equities.
Small down payment
A small down payment is typically considered anything below 10%. However, what’s considered small will depend on the loan type. For conventional loans, a small down payment is between 3% and 10%, whereas some government-backed loans have down payments as low as 0%.
Pros
- Own your home sooner: With a lower down payment, you'll be able to own your home sooner rather than waiting years trying to save up for a larger amount. Owning your home sooner can free you up to pursue other life goals.
- Get into the housing market faster: The sooner you're able to purchase a home, the sooner you can take advantage of appreciating home values. Focusing on saving for a large down payment means you potentially miss out on rising property values.
- More cash for other opportunities: A smaller down payment allows you to set aside more cash. You can use that cash to invest in opportunities with potentially higher returns or enjoy peace of mind by having a reserve of liquid cash on hand in case of emergencies.
Cons
- Higher monthly mortgage payments: Because you’ll have a larger principal to pay down—on top of PMI—you’ll have to pay higher monthly mortgage payments. Plus, lenders often charge higher interest rates for low down payments, which will further increase your monthly costs.
- Less equity in your home: You’ll have less instant equity in your home with a small down payment. This can expose you to risk, especially if housing prices fall and you end up owing more on your mortgage than what your home is worth.
- Less competitive offers: An offer with a low down payment may be less attractive than one with a high down payment. However, this is mostly an issue in highly competitive markets and won’t be a major factor everywhere.
- More interest paid: Over time, you’ll likely pay more in interest than if you’d put more money down. Say you’re buying a $425,000 home with a 5% mortgage interest rate. By putting 20% down, you’ll pay $317,070 in interest over 30 years. But with a 5% down payment, your total interest paid soars to $538,138.
Next steps when buying a house
There’s no single answer to the question of “how much is a down payment on a house?” The amount you’ll want to save will depend on many factors, including your financial situation, location, and life goals. Contrary to popular belief, you don’t need a 20% down payment to buy a house.
When you’re ready to take the next steps in your homeownership journey, you should talk to a real estate agent. An experienced realtor can help you find a lender who’s best suited for your needs, making the process of buying a house feel much smoother and less stressful.
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