Buying a Home
Do I really need a 20% down payment?
The short answer
No. Twenty percent down is a common guideline to avoid PMI and keep payments lower, not a requirement. Most programs accept less, each with its own tradeoffs.
The full answer
Conventional loans can go as low as 3% to 5% down in many cases, usually with PMI that may end under the thresholds described above. FHA and other programs have their own lower-down-payment structures, and Ohio and Kentucky offer down-payment-assistance programs for eligible buyers, with availability and terms varying by county and program, so funding isn't guaranteed for every borrower. The tradeoff is the real story: a smaller down payment means a larger loan, a higher payment, and often mortgage insurance, while a bigger one can mean lower monthly costs and faster equity. There's no universal right answer. Run the scenarios with a lender at today's rates and terms.
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