Is 20% of the price of a new home required as a down payment?
There is no set amount that you must put down. You might be surprised to learn that many first-time home buyer programs require as little as 3% down*. In the past, mortgage lenders most often did require a 20% down payment. But in the last ten years, we’ve seen the introduction of many loan programs designed to help more people buy homes. As a result, mortgage loans can now be tailored to fit each homebuyer’s needs and financial resources. *For down payments of less that 20%, mortgage insurance (MI) will be required and associated costs will apply. This mortgage insurance (PMI) will be required until you have 20% equity in your property. The average life is about 10 years. You may, however, be able to get a new appraisal done in a few years showing 20% equity through appreciation or repayment. If this happens you will be able to drop the insurance.
