How Much of a Down Payment for a House
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How much of a down payment you need depends on the loan: about 3% to 5% on a conventional mortgage, 3.5% on an FHA loan, and 0% on a VA or USDA loan. In New
York City, a condo usually requires 10% to 20% down, and a co-op requires 20% or more, plus 1 to 2 years of reserves.
We’ve represented New York buyers since 2017 and handed back more than $11 million in commission rebates, about $22,000 per closing. A lot of that money goes straight to the buyer’s down payment.
The national answer to this question and the New York answer are two different numbers. This page covers both and then links down to 11 shorter guides on pre-approval, credit, co-signers, and the programs that lower the bar.
| Loan or building type | Typical minimum down |
|---|---|
| VA loan (eligible veterans) | 0% |
| USDA loan (eligible rural areas) | 0% |
| FHA loan | 3.5% with a 580+ credit score |
| Conventional, first-time buyer program | 3% |
| Conventional, standard | 5% |
| NYC condo | 10% to 20% |
| NYC co-op | 20% or more, plus reserves |
Every row below the FHA line comes with conditions, and the last two are where New York stops matching the rest of the country.
How much of a down payment do you actually need for a house
Start with the number that surprises people. In 2025, the median down payment was 19% for all buyers and 10% for first-time buyers, per the National Association of Realtors. Not 20%, and not 3%. Most buyers land in the middle.
The 20% figure is a rule, just as flossing daily is. It’s the target that avoids mortgage insurance and gets the best rate, and almost nobody hits it on their first try. What you truly need is the minimum for your loan type, plus closing costs, plus a cash cushion the lender wants to see afterward.
If you’re still deciding whether to buy at all, our buying process guide lays out everything involved in a purchase. If the monthly payment is the real question, see how much house you can afford on a $100K salary.
The minimum down payment for a first-time buyer
There’s no separate “first-time buyer” down payment rule, but first-time buyers get access to the lowest-down programs. Here’s the floor by loan type.
- Conventional 3%: Fannie Mae’s HomeReady and Freddie Mac’s Home Possible let qualified first-time or lower-income buyers put down 3%.
- FHA 3.5%: available to almost anyone with a credit score of 580. Between 500 and 579, you can still get an FHA loan, but the down payment jumps to 10%.
- VA and USDA 0%: no down payment for eligible veterans or for buyers in designated rural areas within income limits.
Your credit score gets a vote here, and it is not a generous voter. A lower score can push you from a 3.5% loan to a 10% one. It can also raise your rate enough that it costs more than the bigger down payment would have.
Our guide to buying with a low down payment covers each program. The $25,000 Downpayment Toward Equity Act explains the federal first-generation bill that keeps getting reintroduced.
Do you need a 20% down payment, and what does it cost when you don’t
You do not need 20% down for a house. You need it to avoid paying private mortgage insurance (PMI) on a conventional loan.
PMI is a monthly fee for the crime of being normal. It runs roughly 0.5% to 1.5% of the loan amount per year, and it protects the lender, not you.
The upside is that it’s temporary. Under the federal Homeowners Protection Act, you can ask your lender to cancel PMI once you owe 80% of the home’s original value, and it drops off automatically at 78%. So the choice with a 20% down payment home loan is really a trade-off: more cash today for a lower payment and no PMI later.
What the down payment looks like on a $300k, $600k, or $1M home
The number stops being abstract around the time your stomach drops. Here’s the cash for a few price points at common down-payment percentages.
| Home price | 3.5% (FHA) | 10% | 20% |
|---|---|---|---|
| $300,000 | $10,500 | $30,000 | $60,000 |
| $600,000 | $21,000 | $60,000 | $120,000 |
| $1,000,000 | $35,000 | $100,000 | $200,000 |
A $300,000 house barely exists in New York City, so most buyers here are working from the middle and lower rungs. On a $1,000,000 apartment, a 20% co-op down payment is $200,000 before you’ve paid a dollar of closing costs. Run your own numbers with the rebate included on our closing cost calculators.
How to save money for a down payment, and where it comes from
Nobody has the whole down payment sitting in checking. The down payment is assembled, not withdrawn. NAR’s 2025 data on first-time buyers shows that 59% used personal savings, 26% pulled from a 401(k), IRA, or stocks, and 22% got a gift or loan from family. Repeat buyers mostly roll it over, with 54% using the proceeds from their last home sale.
The saving part is boring, and it works: a separate high-yield account, an automatic transfer on payday, and a target date. If you’re buying in two years, that money shouldn’t be in the stock market.
A few rules before you move any of it. A mortgage gift requires a signed gift letter stating it isn’t a loan, and the co-op board reads that letter closely. Cash you move in has to “season” for about two months so the lender can source it, and a 401(k) loan counts against your debt-to-income ratio.
Our guide to the average down payment on an NYC apartment has the local figures.
The New York part nobody warns you about
In most of the country, the down payment is the hard part, and then you’re done. In New York, the down payment is the entry fee, and the co-op board wants to see the money you are not spending.
Three things stack on top of a normal down payment here. A co-op wants post-closing liquidity, usually 1 to 2 years of payments remaining in the bank after closing. At signing, you wire a 10% contract deposit, which our guide distinguishes from the down payment. And many co-ops cap your debt-to-income ratio tighter than a lender, as covered in our guide to lowering your DTI for a co-op.
If your savings still don’t clear the bar, a mortgage co-signer, a guarantor, co-purchasing with a family member, or understanding the difference between a co-signer and a guarantor in New York can help.
What we see on our own closings
NestApple started with a down payment problem, sort of. Georges had bought three apartments at full price. On the fourth, he asked Nicole, a practicing attorney at the time and allowed to earn a commission, to place the offer. It was accepted while they were at the airport, and she rebated the whole commission to the next few buyers who asked.
A Macy’s gift card felt a little light against fifty thousand dollars, so that turned into a company. The arithmetic Georges uses is blunt: on a $1 million deal at 3% to the buyer’s side, “from those 30k we keep 10, we give back 20.”
For a buyer, that roughly $22,000 average rebate lands at closing, when the down payment and closing costs have just emptied the account. It isn’t a discount on a service. It’s a share of a commission that the market kept high, returned to the person who did the buying.
Where the 11 guides below fit
Every part of this page has its own guide. Pick the one that matches the number keeping you up.
Getting qualified: getting a mortgage pre-approval, how much house you can afford on $100K, lowering your DTI ratio for a co-op.
Lowering the down payment: buying with a low down payment, the $25,000 Downpayment Toward Equity Act, the average down payment on a NYC apartment.
Getting help from someone else: the mortgage co-signer guide, the NYC guarantor guide, co-signer versus guarantor in New York, co-purchasing versus a guarantor.
The New York deposit: the contract deposit versus the down payment.
Common questions
How much of a down payment do I need for a house? The minimum for your loan type: about 3% to 5% for a conventional loan, 3.5% for FHA, and 0% for VA or USDA. Most buyers put down more. The 2025 median was 19% for all buyers and 10% for first-time buyers.
Do I need 20% down to buy a house? No. You need 20% down on a conventional loan to avoid private mortgage insurance and get the best rate. Below 20%, you pay PMI until you owe 78% to 80% of the home’s value.
How much is a down payment on a $500,000 house? At 3.5% it’s $17,500, at 10% it’s $50,000, and at 20% it’s $100,000. In New York, a co-op at that price would likely require 20% or more, plus reserves.
Why does an NYC co-op want more than the down payment? Co-op boards require post-closing liquidity, usually one to two years of mortgage and maintenance in the bank after closing. It’s the most common reason a financially “approved” buyer still gets rejected by the board.
Can I use gift money for a down payment? Yes, with a signed gift letter confirming it’s a gift and not a loan. Lenders and co-op boards both scrutinize gift funds, and the money usually needs to be in your account for about 2 months before you apply.
Nicole Fishman Benoliel co-founded NestApple in 2017. She's a lawyer admitted to the New York bar - her law degree is from La Escuela Libre de Derecho in Costa Rica, with further study at IE Business School in Madrid and an LLM from Fordham in New York. She does not act in a legal capacity at NestApple; every client is referred to an attorney who handles real estate deals full time.
