Update: My neighbor insists a 20% down payment is the only way to buy a house, but my lender in Phoenix said we could go as low as 3%.

I keep seeing people online act like you need that full 20% down, which can scare off first-time buyers, but after talking to a loan officer and reading the actual FHA guidelines, I found out there are several programs for way less if your credit is decent, so what's the biggest down payment myth you've had to unlearn?

4 comments

4 Comments

the_paul3mo ago

Oh man, that 20% myth is everywhere! I bought my first place with way less down thanks to a first-time buyer program. It really locks people out of the market for no good reason.

brianreed3mo ago

That "no good reason" part is where I disagree. Putting less down means a bigger loan and higher monthly costs, which can really hurt people if prices drop or they lose income. The 20% thing is a rough rule to stop buyers from getting in over their heads.

moore.beth1mo ago

Yeah and like brianreed said, it feels like a lot of these money rules are just old advice that got stuck. I mean, my parents still talk about the 20% thing like it's a law.

emeryj663mo ago

Right? Like the banks are just hoping you'll keep renting forever.