Down Payment Calculator
Calculate how much you need to save for a home down payment. See the impact of different down payment amounts on your loan and whether you'll need PMI.
Enter a home price to calculate your down payment needs.
How It Works
Your down payment is calculated by multiplying the home price by your target percentage. The remaining amount becomes your loan principal. We also estimate closing costs at 3% of the home price—the actual range is typically 2-5%.
Private Mortgage Insurance (PMI) is typically required when your down payment is less than 20%. PMI costs 0.5-1% of the loan amount annually and protects the lender if you default. You can request PMI removal once you reach 20% equity.
Remember to also budget for an emergency fund, moving costs, and potential immediate home repairs or furnishings beyond the down payment and closing costs.
Frequently Asked Questions
What is the minimum down payment for a house?
Conventional loans require a minimum of 3-5% down. FHA loans require 3.5% with a credit score of 580+. VA loans and USDA loans offer 0% down for eligible borrowers. However, larger down payments mean better rates and lower monthly payments.
Is 20% down payment necessary?
Not required, but it's beneficial. 20% down eliminates PMI, gives you more equity, often secures better interest rates, and means lower monthly payments. However, many buyers successfully purchase with less and build equity over time.
How long does it take to save for a down payment?
This depends on your income, expenses, and target amount. Saving $500/month takes about 7 years to reach $40,000 (10% on a $400K home). Consider high-yield savings accounts, employer down payment assistance, or first-time buyer programs to accelerate your timeline.
What are closing costs and how much should I budget?
Closing costs include loan fees, title insurance, appraisal, inspections, and prepaid items like property taxes and insurance. Budget 2-5% of the home price. On a $400,000 home, that's $8,000-$20,000. Some can be negotiated or rolled into the loan.
Can I use gift money for a down payment?
Yes, most loan programs allow gift funds from family members. You'll need a gift letter stating the money is a gift, not a loan. FHA allows 100% gift funds. Conventional loans may require you to contribute some of your own money depending on down payment size.