How much down payment do I need on my new home

 

My clients often ask me, “How much down payment do we really need?” Well, actually it varies. You can do anywhere from zero down to however much you want to put down. For instance,  veterans can get a VA loan with zero down loan and FHA loan can be a 3.5% downpayment. But keep in mind that with the zero down programs, it does not mean that you don’t have to have any cash. It’s just means that they are not going to charge you money upfront.  But there are going to be appraisal fees and some other closing costs that you need to be aware of and that you are going to need to pay.

Now, generally the more you put down, the better the terms you are going to get. For example, if you are going to put 3.5% down, you are going to have private mortgage insurance and some additional fees, whereas if you put 20% down, that’s not the case. Typically, the better the down, the better the terms, and the easier it is to get the loan. But do keep in mind; there are zero down program loans available. VA does it and rural development does it in rural areas.  You can also get a  3.5% down for FHA.  You can also put down as much as you want over that.   The more you put down, the low your payments going to be, the more on track you will be with your lender. Be sure you speak to your lender about how much comfortably you can put down and they will tell you how much comfortably you can borrow for your home payment.