{"id":38897,"date":"2022-07-26T18:00:00","date_gmt":"2022-07-27T02:00:00","guid":{"rendered":"https:\/\/www.hayden-homes.com\/blog\/?p=38897"},"modified":"2023-05-19T15:57:15","modified_gmt":"2023-05-19T23:57:15","slug":"down-payments-whats-the-magic-number","status":"publish","type":"post","link":"https:\/\/www.hayden-homes.com\/blog\/down-payments-whats-the-magic-number\/","title":{"rendered":"Down Payments: What\u2019s the Magic Number?"},"content":{"rendered":"\n
\"Down<\/figure><\/div>\n\n\n\n

Buying a new home is a major purchase. That\u2019s why the majority of homebuyers finance their homes. Even though you don\u2019t need the full purchase amount upfront, saving enough for a down payment can sometimes be an obstacle for prospective homebuyers. You may have heard that you should have 20% of the purchase price but you can actually choose how much to put down based on your individual situation.<\/p>\n\n\n\n

What is a down payment?<\/h2>\n\n\n\n

The down payment is a percentage of a purchase price that is paid upfront. Down payments allow you to make a large purchase, for like a home or car, without having the full purchase amount at the time of sale. They represent your initial ownership stake in a home. For example, if you decide to buy a home for $450,000 and put down 10%, your down payment will be $45,000 with your lender financing the remaining $405,000.<\/p>\n\n\n\n

The gold standard in homebuying has been a 20% down payment, but most homebuyers put down substantially less. In 2021, the median down payment for all buyers was 13% and 7% for first-time homebuyers.<\/p>\n\n\n\n

Minimum down payment requirements<\/h2>\n\n\n\n

If a 20% down payment isn\u2019t required, how much do you need? Well, that answer depends largely on the type of mortgage program you use.<\/p>\n\n\n\n