Putting at least 20% down on a home will increase your chances of getting approved for a mortgage at a decent rate, and will allow you to avoid mortgage insurance. But you can put down less than 20%. The minimum down payment required for a house varies depending on the type of mortgage:

  • FHA LOANS, require as little as 3.5% down and are backed by the Federal Housing Association.
  • VA LOANS, guaranteed by the U.S. Department of Veterans Affairs, usually do not require a down payment. VA loans are for current and veteran military service members and eligible surviving spouses.
  • USDA LOANS, backed by the U.S. Department of Agriculture’s Rural Development Program, also have no down payment requirement. USDA loans are for rural and suburban home buyers who meet the program’s income limits and other requirements.
  • Some conventional mortgages, such as the Fannie Mae and Freddie Mac, require as little as 3% down. Conventional loans are not backed by the government, but follow the down payment guidelines set by the government-sponsored enterprises Fannie Mae and Freddie Mac.

Down payment requirements can also vary by lender and the borrower’s credit history. The minimum down payment for an FHA loan is just 3.5% with a credit score of 580 or higher, for example, but the minimum is 10% with a credit score of 500 to 579.