Down Payment
A down payment is the portion of the home's purchase price that the buyer pays upfront in cash. The remaining balance is financed through a mortgage.
Down payment requirements vary by loan program. VA and USDA loans may require zero down, FHA loans typically require 3.5%, and conventional loans can start as low as 3%. A larger down payment reduces the loan amount, which can lower your monthly payment and eliminate mortgage insurance.
A down payment is not the same as cash to close. Cash to close includes the down payment plus closing costs, prepaid items, and other fees. Planning for both ensures you are financially prepared.
Why This Matters: Your down payment directly affects your loan amount, monthly payment, and equity position from day one. Understanding your options — and what each loan program requires — helps you make the most strategic use of your savings.
First-Time Homebuyer Louisiana
Common question
What is the minimum down payment for a first-time buyer?
VA and USDA can be $0 down; FHA is 3.5%; conventional can be as low as 3%. Requirements depend on the program and your qualification. A larger down payment can lower your payment and may eliminate mortgage insurance.
Is the down payment the same as cash to close?
No. Cash to close includes the down payment plus closing costs and prepaid items. Plan for both so you are financially prepared for the full amount due at closing.
Related Mortgage Terms
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