Down Payment - Amounts

Amounts

In the United States, down payments for home purchases typically vary between 3.5% and 20% of the purchase price. The Federal Housing Administration, or FHA has advocated lower down payments since its inception in 1934, and currently, borrowers that qualify for an FHA loan pay only 3.5% for a down payment. With rising home prices in the years from 2000 to 2007, lenders were willing to accept smaller or no down payment, (either through 100% Financing, seller-assisted down payment assistance, government down payment providers, or by providing a combination of an 80% 1st and 20% second mortgages), so that more individuals could purchase homes as their primary residences. This trend has been largely reversed since that time. However, in the United States, the VA or Department of Veteran's Affairs, offers 100% financing for qualifying veterans. There are also numerous state and local municipality programs that vary in down payment amounts from zero to $1000 down.

For car purchases the down payment could be anywhere between 3% and 13%.

There is more risk for lenders when individuals purchase a home as an investment property. Therefore the lender may charge a higher interest rate and expect a higher down payment.