Do You Have To Put 20% Down on a House?

Young family moving to a new home without having to put 20% down on the house.

Homebuyers make a median down payment of 12%, according to a 2020 report from the National Association of Realtors. If qualified, you can put as little as 3% down on a home with a conventional loan.

While making a 20% down payment isn’t required, you’ll get a better deal on your mortgage if you do it.

Benefits of Buying a House With 20% Down

Here are some of the biggest benefits of making a large down payment:

  • Score a better interest rate and pay less for your loan.
  • Have lower monthly mortgage payments.
  • Avoid paying for private mortgage insurance.
  • Have an offer that’s more attractive to the seller.

Drawbacks of Putting 20% Down

At the same time, there are some downsides to putting more money down:

  • Leaves less money in your savings for emergencies and to put toward other expenses or financial goals.
  • Can take longer to save for a down payment and buy a home.

Is It Worth Putting 20% Down?

Whether it’s worth making a 20% down payment will depend on your financial situation and personal goals. If you can afford it — or are willing to take the time to save up — then you’ll likely save money by getting lower interest rates and avoiding mortgage insurance. However, if you’re eager to become a homeowner ASAP, then you might choose a loan with a low down payment that lets you put less than 20% down and eat the higher cost of your loan.

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itsHome, a LMB Mortgage Services, Inc. company, is compensated by third-party advertisers, however, any opinions, analyses, reviews or recommendations expressed in editorial content are of the author alone and have not been reviewed, approved, or otherwise endorsed by the advertiser. While reasonable efforts are made to maintain accurate information, the information is presented without warranty.