Down Payment Calculator

Two things flip at the 20% line on a conventional mortgage. First, you cross under 80% loan-to-value, the threshold the Homeowners Protection Act of 1998 uses to define when private mortgage insurance (PMI) can be cancelled, so you stop paying that extra 0.3% to 1.5% of the loan balance per year. On a $320,000 loan at 0.5% PMI, that is $1,600 a year (about $133 a month) returned to your budget. Second, most conforming lenders price loans in two tiers: their best advertised rate typically assumes 20%+ down. Putting less down often adds 0.125% to 0.25% to the rate through Fannie Mae and Freddie Mac loan-level price adjustments (LLPAs), which compounds for the full term. Both effects together mean the after-tax cost of a 10% down loan is meaningfully higher than the headline rate suggests.

FHA loans, insured by the Federal Housing Administration since 1934, allow a 3.5% down payment for borrowers with a FICO score of 580 or higher. Below 580 (down to a 500 floor) the minimum jumps to 10%. The trade-off is FHA mortgage insurance premium (MIP), which has two parts: a 1.75% upfront premium financed into the loan and an annual MIP of 0.45% to 1.05% of the balance. Unlike conventional PMI, FHA MIP usually lasts for the life of the loan when the down payment is under 10%, so the long-term cost can exceed a conventional loan with PMI even though the upfront barrier is lower. FHA is designed for first-time and lower-credit-score buyers; it works best when you plan to refinance into a conventional loan once you cross the 20% equity line.

Yes. The VA home loan program, administered by the US Department of Veterans Affairs since 1944, allows 0% down for eligible active-duty service members, veterans, National Guard, Reserves, and qualifying surviving spouses. There is no PMI requirement either, since the VA itself guarantees a portion of the loan to the lender. The catch is the VA funding fee, a one-time charge of 2.15% to 3.3% of the loan amount on a first-time use with no down payment (waived for veterans with service-connected disabilities). The fee can be financed into the loan, so it does not require cash at closing. USDA Rural Development loans are the only other true 0%-down option, but they are limited to designated rural areas and household income caps.

Three ways stack. First, you borrow less principal, so the amortized P&I shrinks proportionally; on a 7% 30-year loan, every additional $10,000 down saves about $66 a month in P&I for life. Second, crossing 80% LTV (20% down on a conventional loan) drops PMI entirely; on a $400,000 home that is often $100 to $200 a month back in your pocket. Third, lenders price LLPAs in down-payment tiers, so 20%+ down typically buys you a slightly lower rate than 10% down, compounding the saving on the full balance. The combined effect: moving from 5% down to 20% down on the same $400,000 home usually reduces the all-in monthly payment by $300 to $500, even before considering the rate-tier benefit.

For 2026, the baseline one-unit conforming loan limit is $832,750, and the high-cost ceiling is $1,249,125. County limits determine whether a loan is jumbo. Jumbo lenders set their own down-payment, credit, reserve, and debt-to-income requirements, so 20 percent down is common but not a legal requirement. Check the current county limit and lender terms for the property.