2026 Minimum Down Payment for First-Time Homebuyers
Justin Reynolds
Key Takeaways
- VA, USDA, and conventional loans offer 0% minimum down payment options
- FHA requires a minimum down payment of 3.5%
- Lender overlays and credit profile can impact cash needed at closing
Skip ahead — run the numbers now
This guide covers minimum down payment requirements for first-time home buyers in the U.S. in 2026, including FHA, VA, USDA, and conventional loans. Note: This page applies only to U.S. residents.
Eligibility
To be considered a first-time home buyer in the U.S., you must not have owned a primary residence in the past three years. Eligibility requirements for each loan type vary but generally include credit score, income, and debt-to-income ratio considerations.
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Your situation
Programs and caps vary by state and county.
Estimated assistance range
$28,000 – $38,500
About 8% to 11% of a $350,000 home in California
Most likely type
Forgivable second loan
A 0% second lien that disappears if you stay long enough.
Likely qualifies
Your profile lines up well with common DPA programs. Confirm with a lender or counselor.
Assistance Programs
There are several assistance programs available to help first-time home buyers with down payments and closing costs. These include Fannie Mae's HomeReady, Freddie Mac's Home Possible, and government-backed programs like the FHA, VA, and USDA.
Closing Costs
In addition to the down payment, you'll also need to budget for closing costs. These can include appraisal fees, title insurance, and attorney fees. Assistance programs may help with some of these expenses.
Talk to a lender about your minimum down payment options
| Loan Type | Minimum Down Payment | Notes |
|---|---|---|
| Conventional | 3% | HomeReady/Home Possible; PMI required below 20% down |
| FHA | 3.5% | Requires a credit score of at least 580; 10% down for scores 500-579 |
| VA | 0% | Eligible veterans/service members; no PMI, but a funding fee applies |
| USDA | 0% | Eligible rural properties and income limits apply |
The 20% Myth
Many people believe that a 20% down payment is always required to buy a home. However, this isn't true. While a 20% down payment allows you to avoid private mortgage insurance (PMI), there are several loan options available with lower down payments.
HomeReady
Fannie Mae's HomeReady is a low-down-payment mortgage option for eligible first-time home buyers and repeat home buyers. It offers flexible underwriting criteria, including income and property location eligibility.
Home Possible
Freddie Mac's Home Possible is another low-down-payment mortgage option designed to help first-time home buyers, as well as lower-income families and individuals. It also offers flexible underwriting criteria.
FHA Credit Score Tiers
The FHA allows for lower credit scores compared to conventional loans. Typically, a score of 500 or higher is required with a 10% down payment, while a score of 580 or higher allows for a 3.5% down payment.
USDA Income Limits
The USDA offers low-down-payment mortgages to eligible rural home buyers with low-to-moderate incomes. The income limits vary by location, so it's important to check your specific area.
Cited Sources
Program terms and figures on this page change periodically -- verify current details with the linked sources above.
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