How Much Do You Need for a House Down Payment in 2026?
The down payment is usually the biggest hurdle between renting and owning. The old rule says you need 20%, and on today’s prices that sounds like a fortune. In practice most first-time buyers put down far less, and there are trade-offs either way. Here is what the numbers look like in 2026.
Down payments on a typical home
The National Association of Realtors reported a median existing-home sale price of $417,500 for September 2026. Here is what different down payment levels mean on a home at that price:
| Down payment | Amount on $417,500 | Loan type it usually fits |
|---|---|---|
| 3.5% | $14,613 | FHA loan minimum |
| 5% | $20,875 | Conventional loan, with mortgage insurance |
| 10% | $41,750 | Conventional loan, with mortgage insurance |
| 20% | $83,500 | Conventional loan, no mortgage insurance |
Some conventional loans for first-time buyers accept as little as 3%, and VA and USDA loans can require nothing down for eligible buyers. Prices vary hugely by area, so put your own local price into the down payment calculator for a real figure.
What buyers really put down
According to NAR’s 2025 Profile of Home Buyers and Sellers, the median first-time buyer put down 10%, the highest share since 1989, while repeat buyers put down 23%. The same report found the typical first-time buyer was 40 years old, a record high, which shows how long saving for a home now takes.
So 20% is not the norm for first-time buyers. It is the point where you avoid private mortgage insurance on a conventional loan, which is a meaningful saving, but waiting years to reach it can cost more than the insurance if prices keep rising.
Smaller down payment, bigger monthly payment
A smaller down payment means a bigger loan and a higher monthly payment. At a 30-year fixed rate of 6.9%, near the September 2026 average, principal and interest on a $417,500 home come to about $2,475 a month with 10% down and about $2,200 with 20% down. Mortgage insurance adds more with less than 20% down, often somewhere between 0.3% and 1.5% of the loan each year depending on your credit score and down payment.
Taxes, homeowners insurance and maintenance come on top. Lenders generally like your total housing payment to stay under about 28% to 36% of gross income, so check the full monthly cost, not just whether you can reach the down payment.
What mortgage insurance really costs
Private mortgage insurance, or PMI, is the price of putting less than 20% down on a conventional loan, and it is easier to judge in dollars than percentages. With 10% down on a $417,500 home, the loan is $375,750. At a PMI rate of 0.5% a year, a middle figure for a borrower with good credit, that is about $1,880 a year, or roughly $157 a month on top of the mortgage payment.
The good news is that PMI does not last forever. On most conventional loans you can ask the lender to cancel it once the balance falls to 80% of the home’s original value, and federal law requires it to end automatically at 78%. Paying only the scheduled amount on a 30-year loan at 6.9%, the 10% down example reaches 80% after about 8 years and 4 months and 78% after about 9 and a half years. Extra payments, or a rise in your home’s value confirmed by an appraisal, can bring that date forward. FHA loans work differently, and their mortgage insurance often lasts much longer, so check the terms before choosing one.
Waiting for 20% versus buying sooner
Saving to 20% avoids PMI and lowers the monthly payment, but it takes time, and prices may move while you wait. If home prices rise 3% a year, the typical $417,500 home costs about $456,200 three years from now, and 20% of that is about $91,200, nearly $8,000 more than today’s 20% target. In that case, the extra years of saving partly chase a moving goal.
Prices do not always rise, and they can fall in some markets, so this is not an argument to rush. It is a reason to compare both paths with real numbers. Over the full 30 years, the 10% down loan in our example pays about $515,000 in interest, compared with about $458,000 on the 20% down loan, before PMI. That $57,000 gap is the long-run cost of borrowing more, which you can shrink by paying extra once your income grows.
The income lenders look for
Lenders judge affordability by comparing housing costs with gross income. A common guideline is that the mortgage payment, property tax and homeowners insurance together should stay under about 28% of gross monthly income. Taking the $2,475 principal and interest payment from the 10% down example and adding an assumed $450 a month for property tax and insurance, the total is about $2,925 a month. Staying at 28% would mean a household income of about $125,000 a year.
Many buyers qualify with higher ratios, and lower-cost areas need far less income, but the exercise is useful because it shows whether the down payment or the monthly payment is your real constraint. For many first-time buyers in expensive areas, it is the monthly payment. The loan payment calculator and the mortgage payoff calculator show how rate, term and extra payments change the numbers.
Common questions
How much do I need for a down payment on a $400,000 house? $14,000 at the 3.5% FHA minimum, $20,000 at 5%, $40,000 at 10% and $80,000 at 20%, plus closing costs of roughly 2% to 5%.
Is 10% down enough? For many buyers, yes. It is the median for first-time buyers, though it usually means paying PMI on a conventional loan until you reach 20% equity.
When does PMI go away? You can usually request cancellation when your balance reaches 80% of the original home value, and it ends automatically at 78% on conventional loans.
Do not forget closing costs
Closing costs for buyers typically run 2% to 5% of the price, which on a $417,500 home is roughly $8,000 to $21,000. They cover lender fees, title insurance, appraisal and prepaid taxes and insurance. Some can be negotiated or paid by the seller, but plan for them in your savings goal. You will also want an emergency fund left over after you move in, since new homes often come with surprise repairs.
How long saving takes
Saving $1,000 a month in a high-yield account earning around 4%, a 10% down payment of $41,750 takes about 3 years and 4 months, and 20% about 6 years. Raising the saving to $1,500 a month cuts the 10% goal to just over 2 years. The savings goal calculator works out either the time or the monthly amount for your target.
Keep down payment savings somewhere safe if you plan to buy within five years. A high-yield savings account, money market fund or Treasury bills protect the money from a stock market drop right when you need it.
Help that is worth checking
Many states and cities run down payment assistance programs for first-time buyers, offering grants or low-interest second loans, especially for moderate incomes. Family gifts are common too: NAR found 22% of first-time buyers used a gift or loan from relatives or friends. Lenders have rules on documenting gifts, so talk to them early.
The bottom line
On a typical US home in 2026, the down payment ranges from about $15,000 at the FHA minimum to $83,500 at 20%, plus closing costs. Most first-time buyers land around 10%. Choose the level that leaves you with a monthly payment you can comfortably afford and savings to spare. This guide is general information, not financial or mortgage advice, and lenders’ rules vary.
Run your own numbers
This guide is general information for planning, not personal financial advice. Figures were checked on the date shown and can change.