WEOKIE Federal Credit Union By WEOKIE Federal Credit Union • May 15, 2020

What You Need to Know About Mortgage Down Payments

Buying a home is exciting, but some aspects are better than others. Right now, things are different, but safely buying a home is possible and we can help you figure it out.

House shopping? Dreaming about and imagining uses for new rooms, closets, yards, and kitchens? That’s the good stuff that makes people look forward to purchasing their first or next home.

Thinking about the down payment you’re going to have to make isn’t such an exciting prospect. 

However, down payments don’t need to stress you out or overwhelm you. Taking a consistent, long-term approach to putting together the money you need for a down payment will be a strategy that pays off when you are finally in your new home. 


Whether you are buying your first home, getting ready to scale up, or preparing to downsize, there are things you can do to prepare for the process of making that down payment. 

What is a down payment? 

A mortgage down payment is the amount of money that you pay towards a house at the time of purchase. It doesn’t include closing costs, mortgage insurance, or other fees, but it is included in the big lump sum that you pay with cash when you finalize the purchase of a home. 

Your monthly mortgage payments are calculated by subtracting the down payment from the total cost of the house and dividing what is left, plus interest. 

How much do you need for a down payment?

There is some debate about the answer to this question in the world of mortgage lending. The short answer is that 20% is always a good guideline. That would be 20% of the total purchase price of your home. 

Technically, you can buy a home with 3% to 3.5% as a down payment, or with some programs, as little as 0% down. However, the traditional advice remains the same: if you have 20% to put down, you’re going to have a better impact on your mortgage. The financial risk of buying a home is reduced when you can put a significant amount of money towards the house in the first place. 

However, there are definitely circumstances where it is appropriate to put down less than 20%. In fact, the average down payment for first-time home buyers is just 7%, where repeat home buyers typically put down 16%. 

How much SHOULD you have for your down payment? 

This is the real question. It’s not how much you need to have in your down payment, but how much you should put down. 

Here are some general guidelines for determining the right amount for you: 

  • If you don’t have any time limitations on when you need to make a purchase, we recommend taking your time and saving a nice, significant down payment. The more you save, the less you will need to finance. 20% is a great goal for home buyers who are not feeling a time crunch.
  • If you are a first-time home buyer and don’t have a lot of savings, look into loan programs that provide you with the opportunity to pay 0-3.5%. 
  • Check out some of our free WEOKIE resources, including our recent blog post determining how much you can afford as a mortgage. You can also check out our mortgage rates and tools!

Need more guidance? 

It’s normal to have questions during the home shopping and buying process. Right now things are a little different but purchasing a home is still something you can easily do with some research and planning. You may be ready to get pre-approved or already pre-approved and ready to take the next steps. Either way, WEOKIE is here to help! 

Our experienced team of home loan professionals can answer your questions, walk you through potential lending scenarios, and help you every step of the way. WEOKIE’s HomeAdvantage purchasing program can help you find your dream home and you can earn a sizable cash reward (WEOKIE members are averaging $1600 reward per purchase). Contact us today! You can give us a call at 405-235-3030 or 1-800-678-5363. We look forward to helping you move into the home you’ve been dreaming of! 

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