How much do you need for a down payment?


Did you know the median down payment for first-time homebuyers has been 6 percent for three straight years?

If you answered “no” to this question, you are not alone. According to the National Association of Realtors’ Aspiring Home Buyer Profile, 87 percent of non-homeowners said a mortgage down payment of 10 percent or more is necessary.

The Aspiring Home Buyer Profile also finds that eight out of 10 non-owners indicated that owning a home is part of their American dream. Yet, confusion about down-payment requirements is keeping aspiring homebuyers from breaking into the real estate market.

Being unable to afford to buy was the number one reason why non-owners said they don’t own. It seems unrealistic expectations about down payments have kept creditworthy borrowers with manageable levels of debt from exploring the prospects of buying a home.

“Current non-owners’ ultimate goal of owning a home may not be as far-fetched as they believe,” said William Brown, president of the National Association of Realtors. “There are mortgage options available for creditworthy borrowers with manageable levels of debt and smaller down payments. Those interested in buying their first home in 2017 should review their finances, sit down with a lender to see if they qualify for a mortgage and find a Realtor to help them get started on their home search.”

For renters who are ready to join the majority who buy a home with a down payment less than 20 percent, follow these tips to get started:

Review your finances

First, review your financial situation and personal savings to determine how much you can comfortably use for a down payment. Also, decide how much you can afford for a monthly mortgage payment.

Find a Realtor

Second, find a Realtor and talk about the home-buying process. For help finding a Realtor, ask family and friends for recommendations and look for Realtors who specialize in your area. has a directory of all Realtors in Utah. Select a few and interview them to see who best meets your needs.

Talk to your Realtor about their compensation. There’s a common misconception that buyers will have an added expense if they use a Realtor. In reality, however, the seller often pays the buyer’s agent.

Get pre-approved

Before you start shopping for homes, you need to know your price range. Talk to several lenders about their rates and programs and how much you can borrow. If you need help finding someone, your Realtor can give you several names of lenders with whom they’ve previously worked.

Your lender can also tell you how much you’ll need for a down payment. Some mortgages only require 3.5 percent down — much lower than 10 percent. With some programs, no down payment is needed.

Once you know more about how much you can borrow and what your monthly payments would be, discuss your budget and needs with your Realtor. This will help your Realtor hone in your search and only show you available homes in your price range. 

Utilize first-time buyer programs

Finally, utilize resources available to first-time buyers. The U.S. Department of Housing and Urban Development has a state-by-state resource guide of home-buying assistance programs.

In Utah, there are various organizations that provide down-payment assistance, special loans and savings programs. You can learn more about several of these statewide programs by visiting, and The U.S. Department of Agriculture also provides affordable loan options for people moving to rural communities.

To see a complete list of organizations that provide homeownership assistance in Utah, visit and search for Utah. To learn more about home-buying in general, visit Utah