Just realized I was wrong about needing a 20% down payment

Talked to my cousin, a loan officer, over the weekend. He told me, "You know, with an FHA loan you can get in for 3.5% down." I always thought you needed that full 20% to even be considered. He explained how PMI works and it just clicked. Now I'm looking at houses in the $300k range instead of saving forever. Anyone else start looking after learning about low down payment options?

2 comments

2 Comments

sam5301mo ago

My credit union offers a conventional loan with just 3% down. The PMI is pretty cheap and drops off automatically at 20% equity. It's worth checking all the local lender programs.

oliviadixon1mo ago

Yeah, the whole 20% thing is a total myth that holds people back. I was stuck in the same loop for years, thinking I had to save this impossible amount. Then a realtor friend told me about conventional loans with 5% down. My mind was blown. I closed on my place two years ago with way less cash up front than I ever thought possible.