Down payment amounts depend on the loan type and your financial situation

A down payment on a condo is the cash you bring to closing — the money that comes from your own pocket, not borrowed. The amount you need ranges from 3% to 20% of the condo's purchase price, depending on which loan program you use and what the lender requires.

If you're buying a $300,000 condo, a 3% down payment would be $9,000. A 20% down payment on the same condo would be $60,000. Most first-time buyers fall somewhere in the middle, putting down 5% to 10%. The lower your down payment, the more you borrow, which means higher monthly payments and more interest paid over the life of the loan.

Your lender will tell you the minimum down payment they accept once you start the process. Different loan types have different rules, and your credit score, income, and debt also affect what a lender will offer you.

Key Takeaways

  • Down payments typically range from 3% to 20% of the condo purchase price, with 5% to 10% common for first-time buyers.
  • Putting down less than 20% usually means you'll pay mortgage insurance, which adds to your monthly payment.
  • FHA loans allow down payments as low as 3.5%, while conventional loans often require 5% to 10% minimum.
  • Your lender will confirm the exact amount required based on your credit, income, and the specific condo you're buying.
  • Saving more for a down payment lowers your monthly mortgage payment and reduces the total interest you pay.

What happens when you put down less than 20%

If your down payment is less than 20% of the purchase price, your lender will require you to pay mortgage insurance. This is insurance that protects the lender if you stop paying your mortgage — it does not protect you. The cost is added to your monthly mortgage payment.

Mortgage insurance typically costs between 0.5% and 1.5% of your loan amount per year, though the exact rate depends on your credit score, the size of your down payment, and the loan type. On a $270,000 loan (after a 10% down payment on a $300,000 condo), mortgage insurance might add $100 to $300 to your monthly payment.

You can remove mortgage insurance once you've paid down your loan to 80% of the original purchase price, but this takes years. Putting down 20% or more avoids this cost entirely, which is why many people save longer to reach that threshold.

Down payment amounts by loan type

FHA loans are backed by the Federal Housing Administration and are designed for buyers with lower credit scores or smaller savings. The minimum down payment is 3.5% of the purchase price. On a $300,000 condo, that's $10,500. FHA loans require mortgage insurance no matter what, and you pay it for the life of the loan (or at least 11 years if your down payment was 10% or more).

Conventional loans are not backed by the government. Most conventional lenders require a minimum down payment of 5% to 10%, though some will go as low as 3% if your credit score is strong. Conventional loans with less than 20% down require mortgage insurance, but you can remove it once you reach 20% equity in the home.

VA loans are for military members, veterans, and some surviving spouses. Many VA loans require zero down payment, meaning you can buy a condo without saving a down payment at all. There is no mortgage insurance on VA loans. If you served in the military, ask your lender whether you're may be able to access.

USDA loans are for rural properties and also allow zero down payment in some cases, though condos in rural areas are less common. Ask your lender whether the condo you want to buy is in a USDA-may be able to access area.

How to figure out what you can afford to put down

Start by looking at condos in your price range and calculating 3%, 5%, 10%, and 20% of those prices. This shows you the actual dollar amounts you'd need to save. A $200,000 condo requires $6,000 down at 3% or $40,000 at 20% — very different savings goals.

Next, talk to a lender before you start house hunting. They will tell you what down payment amount they require based on your credit score, income, and debt. This conversation takes 15 to 30 minutes and costs nothing. You'll learn whether you may have access to for FHA, conventional, or other loan types, and what the real minimum is for your situation.

Consider how much you'll have left after the down payment. You'll need cash for closing costs (typically 2% to 5% of the purchase price), inspections, appraisals, and moving. You'll also want an emergency fund separate from your down payment money. If you save $30,000 for a down payment but have no money left for emergencies, you're taking on too much risk.

Down payment information programs

Some cities, counties, and nonprofits offer down payment help to first-time buyers. These programs may give you a grant (money you don't repay), a loan with low interest, or a combination of both. The amount varies widely — some programs cover $5,000, others cover $25,000 or more.

To find programs in your area, start with your city or county housing authority website. You can also contact a nonprofit housing counselor through HUD (the U.S. Department of Housing and Urban Development). Search for "HUD housing counselor near me" to find a free counselor who knows local programs.

These programs usually have income limits — you must earn below a certain amount to be may be able to access. Some also require you to take a homebuyer education class, which teaches you about mortgages, budgeting, and home maintenance. The class is usually free and takes a few hours.

Closing costs and other money you'll need

The down payment is not the only cash you bring to closing. Closing costs are fees paid to the lender, title company, appraiser, inspector, and others involved in the purchase. They typically range from 2% to 5% of the purchase price.

On a $300,000 condo, closing costs might be $6,000 to $15,000. Some lenders allow you to roll closing costs into your mortgage (borrow the money instead of paying it upfront), but this means you pay interest on those costs for 15 or 30 years. Many buyers try to save enough to cover closing costs separately from their down payment.

You'll also need money for a home inspection (typically $300 to $500) and an appraisal (typically $400 to $600). These happen before closing. If you're putting down less than 20%, budget for the first year of mortgage insurance as well.

Frequently Asked Questions

Can I borrow my down payment from family or friends?

Most lenders allow down payment gifts from family members, but not from friends or loans you have to repay. If a family member gives you money as a gift, the lender will ask for a signed letter stating it's a gift, not a loan. If you borrow the money, the lender counts it as debt and it affects how much you can borrow.

What if I don't have enough saved yet?

You have several options: save longer, look for a lower-priced condo, use an FHA loan (3.5% down), check whether you're may be able to access for down payment information programs, or ask whether a family member can give you a gift. A lender can tell you which paths work for your situation.

Does a larger down payment always mean a better deal?

A larger down payment lowers your monthly payment and saves you interest over time, but it also means less money in your savings account. If putting down 20% leaves you with no emergency fund, a 10% down payment with mortgage insurance might be smarter. Balance the monthly savings against your financial security.

Can I put down more than 20%?

Yes. Some buyers put down 25%, 30%, or more. The higher your down payment, the lower your monthly payment and total interest. However, make sure you keep enough cash for emergencies and other goals — a down payment should not drain your entire savings.

What if the condo appraises for less than the purchase price?

If the appraisal comes in lower than what you agreed to pay, your down payment percentage changes. If you agreed to put down 10% on a $300,000 condo but it appraises at $280,000, your lender may require you to put down more cash to maintain the 10% ratio. Ask your lender about this before you make an offer.