How much money will you need for a downpayment and closing costs?
Lenders usually expect you to be able to make a downpayment of between 10 and 20 percent of the house’s price and to pay closing costs, often three to six percent of the loan amount. If you make a downpayment of as little as five percent but less than 20 percent, the lender will require you to pay for private mortgage insurance. (Requirements for VA or FHA loans may differ.) Under the federal Real Estate Settlement Procedures Act, the lender must provide you with information on known and estimated closing costs.
