Benefits of putting more than 20% down
If you’re able to do so, you may want to consider putting down a payment that’s larger than 20%. Here are some of the benefits:
- Lower monthly payment due to no mortgage insurance and smaller loan amount
- Less interest paid over the life of the loan
- More flexibility if you need to sell on short notice
Buyers putting down less than 20% are required to pay Private Mortgage Insurance (PMI) monthly until they build up 20% equity in their home.
Where PMI comes in
If you make a down payment of less than 20%, you'll have to pay PMI each month until you build up 20% equity in your home. Take the time to understand PMI as the cost can be relatively small in comparison to the value of being able to secure a 30-year fixed-rate mortgage sooner rather than later.
How much down payment you’ll need for a house depends on the loan you get. While there are benefits to putting down the traditional 20% — or more — it may not be required.
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Get StartedTypes of Loans
You can choose from a wide variety of loans. However, the four common types of mortgage loan programs are:
- Conventional Fixed-Rate Mortgages
- Conventional Adjustable-Rate Mortgage (ARM)
- Federal Housing Administration (FHA) Loan
- VA Loans
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Get StartedFunding your down payment
While most buyers use personal savings to finance down payments, there are many other options, including gifts or loans from relatives. In addition, many state, county, and city governments offer down payment assistance programs to people in their communities who are well qualified and ready for homeownership.
- 70% savings, inheritance, retirement accounts, other assets
- 23% gift or loan from family or friend
- 4% second lien, home equity loan, or equity line of credit
- 10% assistance or loan from nonprofit or government agency
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Get StartedProgress
As a social enterprise, HPP CARES CDE has achieved significant and wide-ranging accomplishments in recent years. Working under the National Coalition for Equities' (NCFE) umbrella, our focus has been on advocating for a strong community voice among federal and state regulators and major private sector corporations. We've dedicated ourselves to addressing public policy issues, particularly those related to wealth and income inequality impacting affordable homeownership and small business growth.
Through collaborative efforts with NCFE, HPP CARES CDE has expanded outreach initiatives, leading to increased corporate social responsibility and consumer protection awareness. Our endeavors have enabled us to engage with a broader audience, forge partnerships with numerous companies, and engage with regulators, all with the goal of supporting deserving individuals in achieving sustainable homeownership, fostering successful small businesses, protecting consumers, and empowering California communities.
At HPP CARES CDE, we are committed to championing opportunities for people of color to become integral partners in our mission to reduce income and wealth inequality, thereby contributing to the creation of stronger futures for all minority groups.
