What Is a Down Payment Calculator?
A down payment calculator helps you determine how much money you need to save for a home purchase upfront. It shows how different down payment percentages affect your required down payment amount and remaining loan amount.
How to Use This Down Payment Calculator
- Enter the home price in the first field.
- Enter your desired down payment percentage (e.g., 20).
- Click “Calculate” to see the required down payment amount and the remaining loan amount.
Key Concepts
A standard down payment is 20% of the home price, which eliminates the need for PMI. However, many loan programs accept 3%–5% down. PMI typically costs 0.5%–1.0% of the loan amount annually and is required until you reach 20% equity. A larger down payment reduces your loan amount and monthly payments while potentially securing a better interest rate.
Down Payment = Home Price × (Down Payment % ÷ 100)
Loan Amount = Home Price − Down Payment
Frequently Asked Questions
Do I need to put 20% down?
No. While 20% avoids PMI, many conventional loans accept 3%–5%, FHA loans require as little as 3.5%, and VA loans offer zero down payment. The right amount depends on your finances and how quickly you want to build equity.
What is PMI and how much does it cost?
Private mortgage insurance protects the lender if you default with less than 20% equity. It costs 0.5%–1.0% of the loan annually ($1,250–$2,500/year on a $250,000 loan) and can be removed once you reach 20% equity.
Should I save for a bigger down payment or buy sooner?
This depends on housing market trends, your rent costs, and investment returns. In a rising market, buying sooner with a smaller down payment may be advantageous. In a stable market, saving for 20% reduces long-term costs.