How Much Down Payment Do I Need to Buy a Home?

Greg Powell
3 days ago
2 min read

One of the first questions buyers ask when starting their home search is: “How much down payment do I need?” The truth is, there isn’t a one-size-fits-all answer. Your down payment depends on the loan program, your financial situation, and your long-term goals. Let’s break down what you need to know.

What Is a Down Payment?

A down payment is the portion of the home’s purchase price you pay upfront. The rest is financed through a mortgage. For example, on a $400,000 home:

20% down = $80,000
10% down = $40,000
3% down = $12,000

Typical Down Payment Options

FHA Loans – As Low as 3.5%

FHA loans are popular for first-time homebuyers because they allow down payments as low as 3.5% with flexible credit requirements.

Conventional Loans – As Low as 3%

Some conventional loan programs allow down payments as low as 3%, especially for first-time buyers. However, anything below 20% typically requires private mortgage insurance (PMI).

VA Loans – 0% Down

If you’re a veteran or active-duty service member, VA loans often allow you to buy with no down payment and no PMI.

USDA Loans – 0% Down

For homes in qualifying rural and suburban areas, USDA loans also allow zero down payment.

Traditional 20% Down

Many buyers aim for 20% down because it eliminates PMI and can secure a lower interest rate. However, it’s not always necessary to reach this threshold.

How Your Down Payment Impacts Affordability

Lower down payment = Easier entry into the market, but higher monthly mortgage payments and PMI.
Higher down payment = Lower monthly payments, less interest over time, and stronger offers in competitive markets.

Central Oregon Perspective

With home prices in Central Oregon (Bend, Redmond, Prineville) often ranging from $400,000–$700,000, here’s what different down payments might look like:

$450,000 home in Redmond:
- 3% down = $13,500
- 10% down = $45,000
- 20% down = $90,000

This shows why many buyers choose smaller down payments to get into the market sooner.

How much down payment you need depends on your budget, loan type, and financial goals. The good news is that you have options—from 0% down with VA or USDA loans to the classic 20% down for maximum savings.

If you’re planning to buy in Central Oregon, talking with a trusted local lender can help you explore programs that fit your needs and get you closer to owning your dream home.