The Truth About Down Payment Myths

For many buyers, the biggest hurdle to homeownership isn’t finding the right house—it’s saving for the down payment. Over the years, several myths have developed that make buying a home feel out of reach. Let’s clear up the most common down payment misconceptions so you know what’s fact and what’s fiction in 2025.

Myth 1: You Need 20% Down to Buy a Home

The truth: While putting 20% down avoids private mortgage insurance (PMI), it’s not required. Many loan programs allow as little as 3% to 5% down, and VA or USDA loans may require no down payment at all.

Myth 2: A Bigger Down Payment Always Wins the House

The truth: Sellers do like strong financial offers, but down payment isn’t the only factor. Offer terms, contingencies, and flexibility with closing dates can sometimes matter more than how much cash you put down.

Myth 3: Down Payments Are Only for First-Time Buyers

The truth: Every buyer needs some form of down payment unless they qualify for a zero-down program. However, repeat buyers often use equity from their previous home to fund it, which can make the process easier.

Myth 4: Assistance Programs Don’t Exist Anymore

The truth: Many state and local programs still provide down payment and closing cost assistance for qualified buyers. These programs are especially helpful for first-time buyers and can make homeownership more accessible.

Myth 5: A Low Down Payment Means You Can’t Afford a Home

The truth: A lower down payment doesn’t always mean financial weakness. For some buyers, it makes sense to keep cash on hand for repairs, emergencies, or investments. The key is choosing a mortgage that fits your budget.

Final Thoughts

Don’t let down payment myths keep you from pursuing homeownership. Today’s lending options are more flexible than ever, and with the right guidance, you may be closer to buying a home than you think.

If you’re unsure which loan or down payment option is best for you, working with a trusted lender and realtor can give you clarity and confidence.