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The Average Down Payment On A House Is Less Than You’d Think
Aside from closing costs and real estate agent fees, one of the most significant upfront costs of a home-buying budget is the money to be set aside for your down payment.
A down payment is a lump sum toward the final cost of a home you're purchasing and represents your primary personal investment into the property.
For many years, there's been a misconception that you must set aside at least 20% of the total home purchase price for a down payment, but this is no longer the case.
While paying a more significant sum upfront will decrease monthly mortgage payments and possibly get you a lower interest rate, the average down payment is much lower than 20%.
According to Realtor.com, the national average in the U.S. for a primary residence is around 13%, although first-time buyers set aside far less at around 6% to 7%.
Some programs, like home loans insured by the Federal Housing Administration (FHA), only require a 3.5% down payment to qualify for financial assistance.