Down payment

How much should you put down?

Educational guide · Updated 2026

The "20% down" figure is so widely repeated that many people think it's required. It isn't. Plenty of buyers put down far less. But how much you put down does involve real tradeoffs worth understanding.

What a bigger down payment gets you

Putting down more reduces your loan amount, which lowers your monthly payment and the total interest you'll pay. At 20% down on a conventional loan, you also avoid private mortgage insurance (PMI) entirely. A larger down payment can also make your offer more competitive.

What a smaller down payment preserves

Putting down less keeps more cash in your pocket — for an emergency fund, moving costs, immediate repairs, or simply not draining your savings. For many buyers, keeping a healthy cash cushion is worth more than the monthly savings a larger down payment would bring. Being "house rich and cash poor" is a real risk.

The PMI question

If you put down less than 20% on a conventional loan, you'll pay PMI — but it isn't permanent. It can typically be cancelled once you reach about 20% equity. So a smaller down payment with temporary PMI is a legitimate strategy, not a mistake, especially if it lets you keep an emergency fund intact.

There's no single right answer

The best down payment balances a comfortable monthly payment against keeping enough cash in reserve. For some buyers that's 20%; for many it's less. Running the actual numbers for your situation beats following a rule of thumb.

This article is educational and general in nature. Specifics vary by lender, loan program, and location. Confirm details with a licensed professional.