Free Down Payment Calculator 2026

Calculate how much you need for a down payment and how long it will take to save. Updated with 2026 mortgage rates.

Home Price

Down Payment Percentage

Monthly Savings

Expected Return on Savings (APY)

How Much Down Payment Do You Need in 2026?

The down payment you need depends on the type of mortgage you get:

3% minimum — Conventional (Fannie Mae HomeReady / Freddie Mac Home Possible)
3.5% minimum — FHA loan (credit score 580+)
0% down — VA loan (veterans and active military)
0% down — USDA loan (rural and suburban areas)
20% down — To avoid PMI (Private Mortgage Insurance)

Reality check: The median down payment for first-time homebuyers in 2026 is 6-8%, not 20%. Most buyers put less than 20% down.

Why 20% Down Payment Matters

No PMI: Saves $100-300/month on a typical loan
Lower interest rate: Lenders offer better rates with more equity
Lower monthly payment: Less principal = less payment
Instant equity: You own 20% from day one
Stronger offer: Sellers prefer buyers with larger down payments
No upside-down risk: If home values dip, you still have equity

Down Payment by Home Price

$200,000 home: 20% = $40,000 / 5% = $10,000 / 3% = $6,000
$300,000 home: 20% = $60,000 / 5% = $15,000 / 3% = $9,000
$400,000 home: 20% = $80,000 / 5% = $20,000 / 3% = $12,000
$500,000 home: 20% = $100,000 / 5% = $25,000 / 3% = $15,000
$600,000 home: 20% = $120,000 / 5% = $30,000 / 3% = $18,000

First-Time Homebuyer Programs 2026

FHA Loan: 3.5% down, credit score 580+ (500-579 requires 10% down). Mortgage insurance required for the life of the loan
Fannie Mae HomeReady: 3% down, income ≤ 80% of area median. PMI cancels at 20% equity
Freddie Mac Home Possible: 3% down for low-to-moderate income buyers
VA Loan: 0% down, no PMI, for veterans, active military, and surviving spouses
USDA Loan: 0% down for homes in eligible rural/suburban areas. Income limits apply
State & local programs: Many offer $5,000-$25,000 down payment assistance grants or low-interest second mortgages. Check with your state housing finance agency

How to Save for a Down Payment Faster

1. Automate savings — Set up automatic transfer on payday to a high-yield savings account
2. Use a high-yield savings account — 4-5% APY in 2026 earns meaningful interest while you save
3. Cut major expenses — Housing is the biggest lever; consider a cheaper apartment for 1-2 years
4. Side income — Freelancing, part-time work, or selling items can add $500-2,000/month
5. Down payment assistance — Many programs offer grants that don't need repayment
6. IRA withdrawal for first home — Withdraw up to $10,000 from a traditional IRA penalty-free for a first home purchase
7. Gift funds — Family members can gift down payment money; just need a gift letter
8. Employer programs — Some employers offer homebuyer assistance as a benefit

PMI: The Hidden Cost of Low Down Payments

If you put less than 20% down, you'll pay Private Mortgage Insurance (PMI):

PMI cost: 0.5-1.5% of the loan amount annually
On a $320,000 loan: $133-400/month ($1,600-4,800/year)
When it cancels: Automatically at 78% LTV, or you can request removal at 80% LTV
Example: $40K down (20%) vs $20K down (5%) on a $400K home: The $20K "saved" costs you $24,000+ in PMI over the years before it cancels

Frequently Asked Questions

How much down payment do I need to buy a house?

It depends on the loan type: 3% minimum for conventional (Fannie Mae/Freddie Mac), 3.5% for FHA, 0% for VA and USDA loans, and 20% to avoid PMI. On a $400,000 home, 20% down = $80,000; 5% down = $20,000; 3% down = $12,000.

What is PMI and how can I avoid it?

PMI (Private Mortgage Insurance) costs 0.5-1.5% of the loan annually when you put less than 20% down. On a $320,000 loan, that's $133-400/month. PMI automatically cancels when you reach 78% loan-to-value. Put 20% down to avoid it entirely.

How long does it take to save for a down payment?

For a $400,000 home with 20% down ($80,000), saving $1,500/month in a high-yield savings account at 4.5% APY takes about 4 years. With 5% down ($20,000), saving $1,500/month takes about 13 months.

Are there first-time homebuyer programs?

Yes! FHA loans require only 3.5% down. Fannie Mae and Freddie Mac offer 3% down programs. Many states and cities offer down payment assistance grants of $5,000-25,000. VA and USDA loans require 0% down for eligible buyers.

Is it better to put 20% down or less?

20% down avoids PMI and gets the best rate, but takes much longer to save. With 5-10% down, you start building equity sooner and home appreciation may offset the PMI cost. In a market with 5% annual appreciation, waiting 3 extra years to save 20% means the home costs 15% more.