How Much You Should Put Down on a House

There are many decision to make in the home buying process. One important decision is how much you should put down on a house. Long ago, everyone believed they needed 20% down to buy a home in Florida. However, that's no longer the case. There are plenty of mortgage programs that allow you to put down 10%, 5%, 3.5%, or even 0%. So, which amount is right for you? Here are a few things to consider when buying a home in the Apopka, Florida area. 

Mortgage Program Requirements

Most mortgage programs have their own down payment guidelines. A typical FHA loan, for instance, requires at least 3.5% down. Conventional loans can vary from 0% to 20%. VA loans have 0% down payment options. If you need to use a specific program, then you will want to find out what down payment options are available. You may not have much choice on how much you should put down on a house. If you qualify for more than one program, then you can compare the down payment requirements along with the other features/costs of each option.

Interest Rate Differences

Some loan programs give you flexibility on down payment amounts. However, your decision may impact the interest rate. Lenders want to encourage larger down payments, so the interest rate is often less with higher down payments. Consider this in your calculations. 

Availability and Use of Funds

Another consideration is how much you have available in funds. Will a higher down payment completely wipe out your savings? As a homeowner, you will need an emergency fund for unpredictable issues or other changes in your life. Will a large down payment be a stretch? Would it be better to provide a smaller down payment but pay a little more in more expenses each month? These are all things that you should think about.

Changes to your mortgage are not easy. It costs money to refinance a loan. In some cases, you may not be able to pull out the money that you've already put into a loan. Therefore, you should think carefully about how much you should put down on a house. Everyone's situation is different, so there's really no single right answer. With the right information and considerations, you can make a decision that is right for you.

  • 214 South Lake Avenue
  • Apopka,FL 32703
  • Office: 407.992.8955
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