What is a down payment on a house and how much is required?

If you're taking out a mortgage, chances are you still need to make a down payment — an upfront deposit that is typically a percentage of the total cost of the house.

The size of your down payment depends on the type of home loan you have, your financial situation and your lender.

Historically, 20% down has been held up as the standard, but that's shrunk over the years: In January 2024, the median down payment was 14.2%, according to real estate data analysis firm ATTOM.

A down payment is the money a homebuyer pays upfront, usually a percentage of a house's purchase price. It shows a lender that you are financially invested in owning the property and less likely to default on mortgage payments.

Usually, a down payment must be made with certified funds, like a certified check, cashier's check or wire transfer.

The amount of your down payment determines the size of your home loan: If you make a 20% down payment on a $500,000 house, for example, you'll need financing for the remaining 80% of the purchase price, or $400,000.

A conventional loan typically requires a down payment of 5% to 20% of the home's value, according to the National Association of Realtors. If you put less than 20% down, however, you will likely be required to obtain private mortgage insurance, which can cost 0.50% of your mortgage on average, until you have at least 20% equity in your house. 

A jumbo loan is a mortgage that is larger than the limits established by the Federal Housing Finance Agency. Down payments on these loans tend to be higher — usually at least 10% of the cost of your home.

It's possible to put down considerably less: With an FHA loan, for example, you can be approved for as little as 3.5% down. There are zero-down mortgages, too — typically through an alternative lender, like a credit union, or with a government-backed mortgage like a USDA or VA loan.

A larger down payment could get you a lower interest rate, while a smaller one will take less time to save up for and leave you more money to pay for repairs, insurance and other costs.

Chase Bank's DreaMaker loan allows homebuyers to make a down payment of as little as 3%, with discounts available for existing Chase customers. And while most lenders require a 620 credit score, there's more flexibility with a DreamMaker loan. Chase will also provide qualified applicants with a grant of up to $7,500 toward their down payment or closing costs.

Applicants must have an annual income that doesn't exceed 80% of the area median income. 

You can also put 3% down with Ally Bank's HomeReady loan, which has no lender's fee and accepts applicants with a debt-to-income ratio of up to 50%.

There is the same income cap, though, and first-time homebuyers need to take an online homeownership course.

Navy Federal Credit Union offers several no-money-down mortgages that don't require mortgage insurance, including VA loans, and will also match any lower rate or give you $1,000.

Membership is limited to current or former servicemembers and their families.

A down payment is a cash deposit on a home that offsets the amount of your mortgage. The size of a down payment depends on the loan type, your financial status and your lender.

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