| % Down | Down Payment |
|---|---|
| 3.5% | $350 |
| 5% | $500 |
| 10% | $1,000 |
| 15% | $1,500 |
| 20% | $2,000 |
| 25% | $2,500 |
FHA loans are loans issued by a bank, but backed by the federal government. They are intended for people can not qualify for a typical bank loan.
The minimum down payment on an FHA loans is 3.5%. For a $10,000 house or condo, this would be $350.
To qualify for a 3.5% down payment, you must have a credit score of at least 580.
Buyers with a credit score of 500 or higher are eligible for an FHA loan with a down payment as low as 10%.
For a $10,000 house, this would be $1,000.
All FHA loans require 'mortgage insurance', which protects the FHA from people who default on their loan. This requires an upfront payment of 1.75% of the loan, as well as additional monthly payments.
Conventional loans are those offered by a bank which might have a variety of terms and rates depending on the amount down and factors such as credit score, debt, and income.
For conventional loans, it is standard to make a down payment of 20%. For a $10,000 house, this would be $2,000.
However, some loans offer down payments as low as 3% to buyers with excellent credit, high income, and large assets.
Buyers who can't put at least 20% down are often required to pay PMI. For a $10,000 loan, this could be as high as $13 a month. Over time, if the buyer builds up equity in the house, PMI will no longer be required.