Free Down Payment Calculator

Down Payment Calculator

See exactly how long it takes to save your down payment with compound interest, compare 3.5% vs 5% vs 20% down scenarios, and find out how much PMI costs you at each level.

3.5%
FHA minimum down
HUD FHA guide
4.5%
HYSA avg APY
FDIC insured

Down Payment Calculator

1 Home & Down Payment Goal
Home Price
$
Target Down Payment$80,000.00
%
20%+ down — no PMI required
Closing Costs typically 2–3%
%
Total cash needed$90,000.00
2 Savings Plan
Already Saved
$
Monthly Savings Contribution
$
Savings Account APY HYSA avg: 4.5%
%
3 Mortgage Assumptions
Rate
%
Term

Enter your home price and savings plan to see your path to homeownership

Down Payment Scenarios — $400,000 Home

Here's how different down payment amounts affect your monthly payment, PMI, and how long it takes to save (assuming $1,500/month saved at 4.5% APY):

Down %Down AmtMonthly P&IPMI/moCash NeededSave Time
3% (Conv. 97)$12,000$2,224$150$22,000~8 mo
3.5% (FHA)$14,000$2,250$133$24,000~9 mo
5%$20,000$2,201$100$30,000~12 mo
10%$40,000$2,097$65$50,000~26 mo
20%$80,000$1,994—$90,000~50 mo

Assumes $400,000 home, 6.75% rate, 30-year term, $10,000 closing costs, saving $1,500/month at 4.5% APY from $0. PMI estimated at standard rates.

Where to Save Your Down Payment

The right account depends on your timeline. Never put your down payment in stocks if you're buying within 5 years:

HYSA
4.5–5.0% APY
Best for down payment savings — liquid, insured, highest safe return
12-mo CD
4.8–5.2% APY
Slightly higher yield, 1-year lock-up — good if timeline is clear
I-Bonds
Inflation +
Inflation protection, 1-year lock-up, $10K/year limit
T-Bills (3-12 mo)
4.9–5.2%
Very safe, competitive rates, state-tax exempt
Stocks / ETFs
7% avg (risky)
Too volatile for <5 year timelines — avoid for down payment

Should You Put 20% Down or Buy Sooner?

The 20% "rule" was standard decades ago when PMI was very expensive. Today, with home prices rising and PMI being relatively affordable, the math often favors buying earlier with less down:

  • Buy now with 5% down if home prices are rising. If homes in your area appreciate 4%/year, a $400,000 home becomes $432,000 in 2 years. The extra PMI cost (~$1,800/year) is less than the extra $32,000 you'd need for the down payment.
  • Wait for 20% if the market is flat. In stable markets, the PMI savings from 20% down justify a longer savings timeline.
  • Consider 10% as a sweet spot. Enough to get competitive rates, PMI cancels within 5–7 years through payments + modest appreciation, and the savings timeline is manageable.
  • Use down payment assistance if eligible. Over 2,000 DPA programs exist — many offer $5,000–$25,000 in grants or forgivable loans for first-time buyers. Search downpaymentresource.com.
FAQ

Down Payment — Common Questions

How much down payment do I need?
Minimums by loan type: VA and USDA = 0% (for eligible borrowers), FHA = 3.5% (580+ FICO), Conventional 97 = 3%, most conventional = 5%. There's no universal requirement to put 20% down — that's a myth. The 20% threshold matters because it eliminates PMI. But many first-time buyers put down 5–10% and cancel PMI once they build 20% equity through payments and home appreciation.
How much does PMI cost and when does it go away?
PMI (Private Mortgage Insurance) typically costs 0.5–1.5% of the loan amount per year, or $83–$250/month on a $200,000 loan. The exact rate depends on your credit score, LTV, and lender. PMI automatically cancels when your loan balance reaches 78% of the original home value (per the Homeowners Protection Act). You can request cancellation at 80% LTV if you've made payments on time. With appreciation, you may reach 80% equity faster than your payment schedule suggests.
Is it better to put 20% down or keep money invested?
It's a math question: compare PMI cost vs. investment return. If your PMI costs $150/month = $1,800/year on a $300,000 loan, and you'd invest the extra down payment at 7% average return — the math typically favors investing. However, real estate appreciation, the psychological value of no PMI, and lower debt also matter. Most financial planners suggest 5–10% down if your PMI cost is under $200/month and you have solid emergency reserves.
Where should I keep my down payment savings?
High-yield savings accounts (HYSA) at online banks are the best option: 4–5% APY, FDIC insured, no lock-up. If buying in 12+ months, also consider: 6–12 month CDs (for slightly higher yield on money you won't need immediately), I-Bonds (inflation protection, but 1-year lock-up), or Treasury bills (competitive rates, liquid). Avoid: stocks (too volatile for a 1–3 year timeline), traditional big-bank savings (0.01–0.1% APY).
How do I speed up saving for a down payment?
Five high-impact moves: (1) Open a HYSA immediately and set up automatic transfers on payday. (2) Apply any windfall (tax refund, bonus, gift) directly to the fund. (3) Cut one major expense category — housing costs, car payment, or subscriptions — and redirect it. (4) Pick up freelance or side work specifically for the house fund. (5) Look into down payment assistance programs — over 2,000 programs exist nationally offering grants and low-interest second mortgages for first-time buyers.
What is down payment assistance?
Down payment assistance (DPA) programs offer grants, forgivable loans, or low-interest second mortgages to help buyers cover the down payment and closing costs. Available through state housing agencies, local nonprofits, and employers. Many programs are for first-time buyers (not owned a home in 3 years) with income limits. Examples: FHA 203(k), USDA grants, Chenoa Fund, state HFA programs. Search downpaymentresource.com to find programs in your area.

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