Coming up with your mortgage down payment is the single biggest roadblock for most homebuyers. Have you saved enough? Use NerdWallet’s free down payment calculator to find out.
The NerdWallet Down Payment Calculator
Saving for a down payment to buy a house can seem overwhelming. But don’t worry, you can break it down into small, actionable moves that can help you save enough to afford a home sooner than you expected.
Four basic steps can help you save enough to buy a house: knowing how much down payment you’ll need, socking away the money, tapping any available outside sources to seed your fund and gaining a small edge with interest.
However you decide to save for your down payment, remember it's all about persistence and small victories. Set up a monthly transfer to a special savings account, save your bonus instead of buying yourself a present, set aside that tax refund, don't buy a new car, take advantage of any savings help your bank offers. You get the picture.
» MORE: Join NerdWallet to assess saving on your existing bills and help you reach your down payment goal faster.
Most lenders are looking for 20% down payments. That’s $60,000 on a $300,000 home. With 20% down, you’ll have a better chance of getting approved for a loan. And you’ll earn a better mortgage rate.
There are all sorts of other benefits, too:
Some lenders and programs will accept less than 20% down, but in most instances you'll need to buy mortgage insurance. That protects the lender in case you default. If there's no mortgage insurance requirement, there can be other upfront or ongoing fees. You should always be aware of loan fees.
So work the numbers, and then start saving. You may already be closer to homeownership than you think.
FAQs
How do you calculate down payment? Down payment is calculated using the formula: down payment = down payment percent times purchase price.
What is the 20% down payment on a $300 000 house? ›
A 20% down payment on a $300,000 mortgage is $60,000. The $60,000 down payment is what most lenders look for especially commercial lenders, because it helps mitigate the risk of default.
Is a 20% down payment realistic? ›
A 20 percent down payment may be traditional, but it's not mandatory — in fact, according to 2023 data from the National Association of Realtors, the median down payment for U.S. homebuyers was 14 percent of the purchase price, not 20.
What credit score is needed to buy a $300K house? ›
The required credit score to buy a $300K house typically ranges from 580 to 720 or higher, depending on the type of loan. For an FHA loan, the minimum credit score is usually around 580.
How much house can I afford if I make $70,000 a year? ›
If you make $70K a year, you can likely afford a home between $290,000 and $310,000*. Depending on your personal finances, that's a monthly house payment between $2,000 and $2,500. Keep in mind that figure will include your monthly mortgage payment, taxes, and insurance.
How much is a 3.5 down payment on a $300 000 house? ›
FHA Loan Down Payment
FHA loans are recognized for their flexibility regarding credit, income, and down payment guidelines. They require a minimum down payment of just 3.5%, which is $10,500 for a $300,000 home.
How much to afford a 250k house? ›
If you follow the 2.5 times your income rule, you divide the cost of the home by 2.5 to determine how much money you need to earn annually to afford it. Based on this rule, you would need to earn $100,000 per year to comfortably purchase a $250,000 home.
How much house can I afford on 40K a year? ›
If you have minimal or no existing monthly debt payments, between $103,800 and $236,100 is about how much house you can afford on $40K a year. Exactly how much you spend on a house within that range depends on your financial situation and how much down payment you can afford to invest.
Is 20k enough for a down payment on a house? ›
Aim for a down payment that's 20% or more of the total home price—that's $40,000 for a $200,000 house.
How much is a 20 down payment on a 500 000 house? ›
Introduction to down payments
It's usually expressed as a percentage of the purchase price. So, if your mortgage requires that you put down, say, 3%, the down payment needed for a $500K house would be $500,000 x 3% = $15,000. And a 20% down payment would require $100,000 ($500,000 x 20% = $100,000).
The larger your down payment, the less you'll have to borrow, and so the lower your monthly payment will be. This sum is expressed as a percentage of the home's purchase price, and 20 percent is traditional. On a $300,000 property, that would be $60K — an intimidating sum for many, but help is often available.
How much house can I afford with $10,000 down? ›
If you have a conventional loan, $800 in monthly debt obligations and a $10,000 down payment, you can afford a home that's around $250,000 in today's interest rate environment.
