The exact amount you need for a downpayment on a home when buying it with a mortgage loan clearly depends on the value of the house itself. The greater that total cost, generally speaking, the more you’ll need for a downpayment.
More important than looking at the totals, then, is to look at the percentages. When you know what percentage of the cost you’ll need for a downpayment, you can determine how much you’ll roughly have to pay in any bracket, whether you’re buying a fixer-upper for $100,000 or a dream home for over $1,000,000.
What type of loan do you have?
It matters what type of loan that you’ll take out as well. For instance, the absolute minimum on an FHA loan is 3.5%. So, if the house costs $300,000 in total, you’d need to put down about $10,500. Every $100,000 in the total price costs you another $3,500 upfront.
This is the minimum, though, and you may have a better chance of actually getting the loan if you can show that you have a larger downpayment and, theoretically, a better financial situation. Some experts recommend putting down 20% if you can, which would be $60,000 on that $300,000 house.
There are also many potential solutions in the middle. For example, an FHA loan only requires a minimum of 3.5%, but you can certainly offer 5% or 7.5% if you want to increase your odds of being given the loan.
There are many steps to consider when buying a house, and it’s a significant financial investment, so be sure you know all of your legal options.