When you purchase a home, chances are you will put money down on it. This down payment is an up-front payment made in cash that is a percentage of the total home cost. This percentage is typically 20%, though it can vary based on your circumstances and loan program.

Here’s what you should know about what determines your down payment:

Amount of cash available to youbuying a home

Have you been saving up? How much cash you have available on hand will limit how much of a down payment you can make. For example, if you only have $10,000 available for a down payment, and the home you want to buy is $240,000, you may want to save up some more to meet minimum requirements.

To figure out how much you will need to save up for in a down payment, find out your home price range and calculate a standard 20% down payment just to be safe.

Remember that the “traditional” 20% down is not always required.

Your mortgage program and credit score

Your credit score and the type of mortgage program you choose will go a long way in deciding your down payment. Some loan programs will allow you to pay a lower down payment, and the lending program you choose will often have a minimum down payment based on your credit score.

If you have an FHA loan, the minimum down payment is 3.5%. If you qualify for a VA or USDA loan, your down payment can be as little as zero.

The price of the home

The price of the home will also be a deciding factor on how much your down payment will be, as well as how high or low a percentage of that price you can put down on it. If you purchase a home for $250,000 and put down a standard 20% loan, you put down $50,000 on the house. Since you put down $50,000 in cash on the home, you would have to borrow around $200,000.

Your down payment will affect your mortgage rates

Remember, whatever you decide to put down on a home, that down payment will affect your monthly mortgage rates. Typically, the higher your down payment, the lower your interest rate, no private mortgage insurance, and lower monthly payments.

When deciding how much to put down on a home, consult with your financial advisor and loan officer at They will help guide you through the process and give you the information you need to know.

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The above information is for educational purposes only. All information, loan programs and interest rates are subject to change without notice. All loans subject to underwriter approval. Terms and conditions apply. Always consult an accountant or tax advisor for full eligibility requirements on tax deduction.