Down Payment Calculator
Work out your down payment (or the home price your cash can buy).
Details
Down payment
$80,000
20% of the home price
Home price
$400,000
Loan amount
$320,000
Monthly P&I
$2,022.62
Down payment %
20%
20% or more down
This works out your down payment and what it leaves you borrowing. Enter a home price and a percentage, or enter the cash you have and see what price it supports.
It also estimates closing costs and the monthly payment on the remaining loan, so you can see the full cash needed rather than just the deposit.
What a down payment does
A down payment is the cash you put in up front. The rest is the mortgage. Put $80,000 down on a $400,000 home and you borrow $320,000.
It does two things: it reduces what you borrow, and it decides whether you pay private mortgage insurance. Below 20% down, conventional lenders normally require PMI, which is an extra monthly cost that protects them rather than you.
That 20% is a PMI threshold, not a requirement to buy. Plenty of conventional loans accept 3-5%, and FHA loans go to 3.5%. Waiting years to reach 20% while prices and rents rise is often the more expensive choice.
Every option below 20% is a real option. The difference is PMI and a larger loan, not whether you are allowed to buy.
What to enter
- What do you know?
- Work forwards from a home price, or backwards from the cash you have available.
- Home price
- The purchase price. Your offer, not the asking price, if they differ.
- Down payment
- As a percentage or a dollar amount. Both are shown so you can see them together.
- Closing costs
- Fees due at completion, typically 2-5% of the price. These are on top of the down payment and are the part first-time buyers most often miss.
- Interest rate and loan term
- Used to show the monthly payment on what you would be borrowing.
Minimum down payments by loan type
- Conventional
- As little as 3% for qualifying buyers. PMI applies below 20%.
- FHA
- 3.5% with a qualifying credit score. Carries its own mortgage insurance, which on most FHA loans lasts the life of the loan.
- VA
- 0% for eligible service members and veterans. No monthly mortgage insurance, though a funding fee usually applies.
- USDA
- 0% in eligible rural areas, subject to income limits.
- 20% conventional
- No PMI, a smaller loan and usually a slightly better rate.
What this assumes
Closing costs are estimated as a percentage. Actual costs vary by state and lender, and the loan estimate you receive is the figure that counts.
You will also need cash beyond this for moving, immediate repairs and a reserve. Arriving at completion with nothing left is a common and avoidable mistake.
How to calculate your down payment
Two multiplications, and then the part people forget: the closing costs on top.
- percentage
- As a decimal, so 20% is 0.20
- loan
- What the mortgage has to cover
Work out the deposit. Price × percentage. 20% of $400,000 is $80,000.
Subtract it from the price. That is the loan: $320,000.
Add closing costs. Typically 2-5% of the price, due at completion and separate from the deposit.
Total the cash needed. Down payment plus closing costs is what you actually need in the bank.
See a worked example: a $400,000 home at 10% down
- Price
- $400,000
- Down payment
- 10%
- Closing costs
- 3%
Down payment: $400,000 × 0.10 = $40,000.
Loan amount: $400,000 − $40,000 = $360,000.
Closing costs at 3%: $12,000.
Total cash needed at completion: $52,000, not $40,000.
Because this is under 20%, PMI applies until the balance reaches 80% of the original price.
$40,000 down, $52,000 cash needed
Frequently asked questions
- Do I really need 20% down?
No. It is a threshold for avoiding PMI, not a requirement to buy. Conventional loans go as low as 3%, FHA to 3.5%, and VA and USDA loans to zero for those who qualify.
The real question is whether waiting to reach 20% costs more than the PMI would. While you save, prices and rates may move, and you are paying rent throughout. Often buying sooner with PMI works out better.
- What is PMI and how long does it last?
Private mortgage insurance protects the lender if you default. It typically costs between 0.5% and 1.5% of the loan a year, added to your monthly payment.
On a conventional loan it is not permanent: it ends automatically once the balance reaches 78% of the original value, and you can request removal at 80%. FHA mortgage insurance is different and usually lasts the life of the loan unless you refinance.
- How much cash do I need in total?
The down payment plus closing costs, which typically run 2-5% of the price. On a $400,000 home at 10% down, that is roughly $52,000 rather than $40,000.
Budget beyond that too. Moving, immediate repairs and a few months of reserves matter, and lenders often want to see reserves anyway.
- Is a bigger down payment always better?
Not necessarily. It lowers your payment and avoids PMI, but it also empties your savings into an asset you cannot easily draw on.
Putting every dollar into the deposit and having nothing left for a boiler failure is a genuinely risky position. Keeping a reserve is usually worth more than the last few thousand off the loan.
- Can I use gift money for a down payment?
Usually yes. Most loan programmes allow gifted funds from family, with a signed gift letter confirming it is not a loan.
Lenders will want to see where the money came from, so a large deposit appearing in your account shortly before applying will be questioned. Move gift funds early and keep the paperwork.
Problems people actually run into
Saving for 20% while renting for years
Waiting to reach 20% feels prudent, and sometimes it is. But the cost of waiting is real: rent paid meanwhile, prices that may rise, and rates that may move against you.
PMI on a 10% deposit is usually a few hundred a month and it eventually falls away. Compare that against several more years of rent before assuming waiting is the safer choice.
Budgeting the deposit and forgetting closing costs
Buyers save diligently for the down payment and then discover another 2-5% of the price is due at completion for appraisal, title, origination, taxes and prepaid insurance.
On a $400,000 purchase that is $8,000 to $20,000 on top. Ask for a loan estimate early so the number is not a surprise in the final week.
Results are estimates for general information only and are not professional financial, medical, or legal advice. Read our full disclaimer.
Last updated: September 4, 2026
