How much should I put down on a home?

Minimum viable: 3–3.5% for conventional/FHA (you'll pay PMI). Sweet spot: 10–15% (lower PMI, lower monthly payment, more manageable savings timeline). PMI-free: 20%+ (no PMI, best rate). Beyond 20%: diminishing returns — extra capital is often better invested. The right answer depends on your savings rate, market conditions, and how long you plan to stay in the home.

What is PMI and when does it go away?

Private Mortgage Insurance protects the lender if you default. Cost: 0.5–1.5% of loan amount annually. On a $300,000 loan, that's $125–375/month. PMI is required when your down payment is less than 20% on a conventional loan. It's removed when your equity reaches 20% (either through payments or appreciation). You can request removal at 20% equity or it's automatically canceled at 22% equity by law.

Can I use gift money for a down payment?

Yes, with documentation. Conventional loans allow gifts from family members, generally requiring a gift letter stating the funds are not a loan. FHA allows gifts from family, employers, and charitable organizations. VA and USDA allow gifts. Lenders will ask for the source of funds — large deposits in recent months will be scrutinized during underwriting.

Should I invest the down payment savings in the stock market?

For down payments needed within 1–2 years: no. Market volatility could reduce your balance right when you need it. Keep short-term down payment savings in high-yield savings accounts (HYSA) or short-term Treasury bonds — currently 4.5–5%. For a goal 3–5+ years away, some equity exposure may be appropriate, but with a plan to shift to stable assets 12–18 months before you need the funds.

Are there down payment assistance programs?

Many exist at state, county, and city level. Common programs: grants (free money, no repayment), forgivable second mortgages (forgiven after 5–10 years of residency), deferred second mortgages (repaid when you sell or refinance), and matched savings programs. Income and home price limits apply. Search HUD's website or your state housing finance agency for programs in your area.

🏦Borrowing

Down Payment Calculator: How Long Until You Can Buy a Home?

How long until you can afford a down payment?

What This Does

Saving for a down payment is the most significant financial hurdle for most first-time homebuyers — and the strategy you use matters as much as the amount you save. Do you wait until you have 20% to avoid PMI, or buy sooner with 3–5% and start building equity now? The right answer depends entirely on your specific numbers: how much you can save per month, how fast the local market is appreciating, and how long PMI would cost you if you go in with less. The conventional wisdom that "you need 20% down" is outdated. Conventional loans allow as little as 3% down for first-time buyers. FHA loans allow 3.5%. VA loans allow zero down payment. Each has different costs and tradeoffs. But the 20% threshold remains meaningful for one specific reason: it eliminates Private Mortgage Insurance (PMI), which costs 0.5–1.5% of the loan amount per year — $125–375/month on a $300,000 loan. This calculator tells you exactly how long it takes to reach your down payment goal at your current savings rate. It shows the monthly savings milestone chart, the PMI cost of going in with less, and the breakeven comparison between waiting for 20% vs. buying with 5–10% now. Sometimes the market appreciation you'd miss while saving outweighs years of PMI. Sometimes it doesn't. The calculator makes that comparison concrete.

When Should You Use This?

→Planning a first home purchase and estimating when you can realistically close
→Deciding whether to put 5% down now or wait until you have 20%
→Understanding how much PMI will cost you if you buy with less than 20%
→Setting a monthly savings target to hit your down payment goal by a specific date
→Evaluating whether to redirect other savings (vacation fund, car fund) toward the down payment

Example Scenario

Priya and her partner want to buy a $420,000 home. They currently have $28,000 saved and can save $1,800/month. The 20% down payment ($84,000) requires $56,000 more — about 31 months away. Buying now with their $28,000 (6.7% down) means $250/month PMI until they hit 20% equity (~8 years). The calculator shows: waiting 31 months for 20% saves $250/month in PMI but delays homeownership by 2.5 years and likely misses significant equity appreciation in their market. They decide to buy with 10% and a gift from family.

Down Payment Calculator

Savings Timeline · All Down Payment Options · PMI Analysis · Acceleration Scenarios

Results update in real time as you adjust any input.

Home & Savings

Home Price

Current Down Payment Savings

Monthly Savings Contribution

Savings Account APY

HYSA: ~4.5–5% · Traditional: ~0.01%

Goals

Target Down Payment

Annual Gross Income

For savings rate calculation

About This Calculator

This down payment calculator computes savings timeline using the future value of an annuity formula with compound interest (FV = PV×(1+r)^n + PMT×((1+r)^n−1)/r) at the specified APY. It evaluates five standard down payment tiers (3%, 3.5%, 5%, 10%, 20%) with realistic rate assumptions per tier, PMI cost estimates (annual PMI/12), and calculates total PMI until reaching 80% LTV. Monthly mortgage payments use the standard amortization formula at each tier's rate. All results update in real time as you adjust any of the six inputs.

The savings growth area chart renders your savings balance month by month (with compound interest at your APY) vs a flat target line, showing the inflection point where contributions plus interest cross the target. It is always visible above the tabs. The Options tab renders a stacked bar chart showing monthly P&I (accent) and PMI (red) at all five down payment tiers, with your target highlighted, and a full comparison table. The Acceleration tab shows a bar chart of months to goal at four extra monthly contribution levels, plus accelerator detail cards. The Milestones tab shows a bar chart of months to each milestone (3%/5%/10%/20%) plus progress cards.

Savings score (0–100): monthly contribution as % of income (30 pts), current progress % (35 pts), time-to-goal tier (25 pts), savings rate APY bonus (10 pts). Dynamic accent: emerald (On Track ≥80), indigo (Good Progress ≥60), amber (Long Journey ≥40), orange (Needs Acceleration ≥20), red (Plan Required). Four auto-trigger flags: timeline over 60 months, savings rate below 10% of income, APY below 1%, and already qualifying for a lower down payment than the target. Four insights and four What To Do Next steps adapt to three score tiers. The PDF export shows the full options table with ready/date indicators.

Results are estimates only and do not constitute financial, tax, or legal advice. Consult a qualified professional before making financial decisions.