What is the minimum down payment required for a mortgage?

How much cash do you need to bring to closing for your down payment? Read this article to learn more!
<a href='https://rosegate.com/author/kbyrd/'>Katherine Byrd</a>
Katherine Byrd
May 10, 2023
2 min read

Buying a home is a dream for many people, but for most, it requires a mortgage. One of the most common questions asked by homebuyers is, “What is the minimum down payment required for a mortgage?” At Rosegate Mortgage, we understand that the down payment is a crucial aspect of the home-buying process, and we’re here to help.

The minimum down payment required for a mortgage depends on several factors, including the type of mortgage you’re applying for and the lender’s requirements. Generally speaking, conventional mortgages require a down payment of at least 3%, while government-backed loans, such as FHA loans, require a down payment of as little as 3.5%.

Conventional Mortgages:

Conventional mortgages are home loans that are not guaranteed or insured by the government. They are offered by private lenders and are generally more difficult to qualify for than government-backed loans. Conventional mortgages typically require a down payment of at least 5%. However, if you are a first-time homebuyer, you are able to put down as little as 3%.

It’s important to note that if your down payment is less than 20% of the home’s purchase price, you will be required to pay for private mortgage insurance (PMI) until you reach that threshold. PMI protects the lender in case you default on the loan, and it can add hundreds of dollars to your monthly mortgage payment.

FHA Loans:

FHA loans are government-backed loans that are designed to help first-time homebuyers and those with lower credit scores. FHA loans require a down payment of at least 3.5% of the home’s purchase price. In addition, FHA loans have more flexible credit score requirements than conventional loans. However, they also require borrowers to pay mortgage insurance premiums (MIP) for the life of the loan.

Other Government-Backed Loans:

In addition to FHA loans, there are other government-backed loans that may require a lower down payment. For example, VA loans are available to veterans and active-duty military members and require no down payment. USDA loans are designed for low-to-moderate-income borrowers in rural areas and require no down payment.

At Rosegate Mortgage, we offer a wide range of mortgage options to meet the needs of every homebuyer. Our experienced loan officers can help you navigate the home buying process and find the loan that’s right for you. Contact us today to learn more about our mortgage options and to get pre-qualified for a home loan.

You might also like
October 5, 2023

Unlocking the Power of Home Equity: A Comprehensive Guide

Homeownership is a significant milestone in life, and it comes with a hidden treasure - home equity. Understanding how to make the most of your home's equity can open up a world of financial opportunities. In this comprehensive guide, we'll explore the concept of home equity, its benefits, and various strategies to leverage it for your financial well-being.

3 min read
September 6, 2023

Maximizing Financial Potential: The Benefits of a Cash-Out Refinance Mortgage

At Rosegate Mortgage, we understand that homeownership is not just about finding the perfect house; it’s about making your home work for you. A cash-out refinance mortgage can be a powerful financial tool, allowing you to leverage your home’s equity for various purposes. In this blog post, we’ll explore the numerous benefits of choosing a […]

3 min read
June 28, 2023

Boost Your Credit Score for Homebuying Success

Want to purchase a home? Discover effective strategies to improve your credit score. Learn how Rosegate can assist you in achieving your homeownership goals by providing valuable insights on credit improvement.

3 min read