If you’re planning to buy with an FHA loan and wondering how much cash the down payment takes, the answer starts with your credit score. The FHA loan down payment is at least 3.5% of the home’s price with a credit score of 580 or higher, and at least 10% with a score from 500 to 579.
On a $430,000 home, close to the national median price, 3.5% down is $15,050. A gift can cover all of it, but the down payment cannot be covered by seller contributions.
Key Takeaways
- FHA requires at least 3.5% down with a credit score of 580 or higher and 10% down with a score from 500 to 579. Lenders can require a higher score than HUD does.
- On a $430,000 home, the FHA minimum down payment is $15,050 at 3.5% and $43,000 at 10%, and closing costs come on top of it.
- In 2026, the FHA loan limit for a one-unit home is $541,287 to $1,249,125 depending on the county. In the lowest-limit counties, 3.5% down covers a price of up to about $560,000.
- A gift from a family member, employer, close friend, charity, or government homebuyer program can cover your entire FHA down payment. The seller, agents, builders, and anyone else who profits from the sale can’t contribute any of it.
- Putting 10% or more down on an FHA loan ends the annual mortgage insurance premium after 11 years. With less than 10% down, the premium lasts for the life of the loan.
FHA Loan Down Payment Requirements in 2026
FHA loans are insured by the Federal Housing Administration, part of HUD, the U.S. Department of Housing and Urban Development. That insurance is why lenders can accept a smaller down payment. HUD calls the down payment the Minimum Required Investment. The FHA minimum down payment depends on your credit score and on the appraised value your lender uses for the home.
3.5% down with a 580 or higher credit score
With a score of 580 or higher, FHA will insure up to 96.5% of the home’s value, so your down payment is at least 3.5%, according to HUD’s down payment guidance. The 3.5% minimum is the same for first-time buyers and repeat buyers.
The score that is used in your qualification analysis is your middle score. If your credit report shows three scores, HUD uses the median, so scores of 575, 590, and 610 make 590 your score. Under HUD’s credit score rules, if you buy with a co-borrower, the lower of your two middle scores sets the minimum.
10% down with a score from 500 to 579
A score from 500 to 579 limits the loan to 90% of the home’s value, which means 10% down. Below 500, FHA financing isn’t available.
Lenders will often have overlays and, depending on the investor, can require a higher credit score than HUD does. Our minimum credit score for an FHA loan is 580. If your middle score is under 580, talk with us about your credit before you make an offer; our team can help you come up with a plan to purchase in the near term.
What Your Down Payment Is Measured Against
HUD’s loan amount rules measure your down payment against the Adjusted Value of the home, which is the lower of the purchase price or the appraised value. If the appraisal comes in below the purchase price, you pay the difference in cash, on top of 3.5% of the appraised value.
If a home under contract for $430,000 appraises at $420,000, the largest FHA loan is 96.5% of $420,000, or $405,300. In this scenario of a shortfall, your down payment becomes $24,700 instead of $15,050, which means an additional $9,650 is required to cover the appraisal shortfall.
A low appraisal doesn’t lock you into paying the difference. If you sign the purchase contract before you receive the FHA appraisal, FHA requires the contract to include an amendatory clause. There are a few exceptions to this rule, including HUD-owned homes and foreclosure sales, that don’t require the clause.
The amendatory clause lets you walk away without losing your earnest money, the deposit you make when the seller accepts your offer, if the appraisal comes in below the price. In the event of an appraisal shortfall, you can also work with your agent to renegotiate the purchase price or consider the option of bringing in the additional cash to close to cover the shortfall.
Two- to four-unit homes
The 3.5% minimum also covers a two- to four-unit home you’ll live in, and the FHA loan limit rises with each added unit. Three- and four-unit homes must pass FHA’s self-sufficiency test, which requires the property’s rent, after an allowance of at least 25% for vacancy and upkeep, to cover the full housing payment.
HUD’s multi-unit rules also require three months of payments in reserve after closing for three- and four-unit homes. We’ve walked through how the self-sufficiency test plays out on a fourplex purchase with FHA.
How Much Is an FHA Down Payment at Different Prices?
The minimum required down payment is based on a percentage of your purchase price, so the dollar amount moves with the price. The $430,000 example is the National Association of Realtors’ national median existing-home price of $429,100 for August 2026, rounded to the nearest $10,000, and each example assumes the home appraises at the purchase price. The base loan is the amount you borrow before FHA’s upfront mortgage insurance premium is added, and you can roll that premium into the loan instead of paying it at closing.
| Home price | 3.5% down (580 or higher score) | 10% down (required at 500 to 579) | Base loan at 3.5% down | Upfront premium if financed |
|---|---|---|---|---|
| $300,000 | $10,500 | $30,000 | $289,500 | About $5,070 |
| $430,000 | $15,050 | $43,000 | $414,950 | About $7,260 |
| $500,000 | $17,500 | $50,000 | $482,500 | About $8,440 |
| $560,000 | $19,600 | $56,000 | $540,400 | About $9,460 |
From $300,000 to $560,000, every base loan at 3.5% down is under $541,287, the lowest FHA limit in the country, so 3.5% down works in any county. We break out every loan option on a $300K house and a $500K house in separate guides.
When the FHA Loan Limit Raises Your Down Payment
FHA caps the base loan at your county’s limit. In 2026, the one-unit FHA loan limit is $541,287 in the lowest-cost counties and up to $1,249,125 in the most expensive ones, according to HUD’s 2026 loan limit announcement. If you finance the upfront premium, it’s added on top of the limit, so your total loan can be higher than the limit.
In a county with the $541,287 limit, 3.5% down covers a purchase price of up to about $560,000. Above that price, your down payment covers the full difference between the price and the $541,287 limit. On a $650,000 home in that county, the minimum down payment is $108,713, or about 16.7%.
At that price, a conventional loan, which isn’t backed by a government agency, requires less cash because of its higher loan limits. With 5% down, or $32,500, the $617,500 conventional loan is under the 2026 conventional loan limit of at least $832,750 for a one-unit home, set by the Federal Housing Finance Agency.
In the highest-cost counties, 3.5% down covers a price of up to about $1,290,000. You can look up your county on HUD’s FHA mortgage limits page, and our guide to FHA loan limits explains how they’re set.
Where Your FHA Down Payment Can Come From
FHA down payment requirements don’t only touch on the minimum required funds for down payment, but they also touch on acceptable sources of funds. Your lender has to document the source of every dollar used toward your transaction. Here are some examples of acceptable sources:
- Your own savings. Checking, savings, and money market accounts, documented with your statements. Large deposits other than paychecks need a paper trail showing where the money came from.
- Proceeds from selling a home you own now. What’s left after the sale pays off your current loan and selling costs.
- Gifts. Money from a relative, employer, close friend, or another donor HUD allows.
- A loan from a family member. HUD allows a relative to lend you the down payment as a second loan. Your lender includes its monthly payment when figuring out how much you can afford. This can be complex, so always discuss with a lender first.
- Down payment assistance. From government agencies, including state housing finance agencies, which run homebuyer programs.
- A loan backed by your own assets. A loan against a certificate of deposit, investment account, or other real estate you own, from a lender with no stake in your purchase.
- Retirement savings. You can use your 401(k) to buy a house through a loan or a withdrawal. A withdrawal may carry income tax and an early-withdrawal penalty.
FHA Gift Funds
HUD doesn’t require any part of the minimum down payment to come from your own savings, so an acceptable gift can cover all of it. Gifts may come from a family member, your employer or labor union, a charitable organization, or a government agency with a homebuyer assistance program. A close friend can also give if the relationship is clearly defined and documented.
HUD defines family broadly. It includes a spouse or domestic partner, children, parents, grandparents, siblings, aunts and uncles, in-laws, and step and foster relatives.
You and the donor sign a gift letter with the donor’s name, address, phone number, relationship to you, the dollar amount, and a statement that no repayment is expected. Your lender also verifies the transfer under HUD’s gift documentation rules. Records can include the donor’s bank statement showing the withdrawal and your deposit, or proof of a wire to escrow, the neutral account that holds the money until closing.
A donor’s own cash on hand, meaning money kept outside a bank, isn’t an acceptable source for a gift. If a relative has already given you cash, talk with us before you deposit it.
Down Payment Assistance With an FHA Loan
HUD doesn’t give down payment grants directly. It funds state and local governments that run down payment assistance programs, which you can find through HUD’s state listings. Assistance from a government agency or housing finance agency can count toward your minimum down payment, whether it arrives as a grant or as a second loan.
State and local programs choose which lenders can offer them, so ask us which ones we can pair with your FHA loan. We offer Chenoa Fund down payment assistance, run by CBC Mortgage Agency, a housing finance agency of the Cedar Band of Paiutes. It pairs an FHA first mortgage with a second mortgage that can cover the minimum down payment, and it requires a credit score of at least 600.
The Chenoa Fund second mortgage comes in two versions. The repayable version adds a monthly payment, which your lender includes when figuring out how much you can afford. The forgivable version is forgiven after a set number of on-time payments on your FHA loan, and the full amount comes due if you sell or refinance before then.
Money That Can’t Count Toward Your Down Payment
HUD rules out these sources for the minimum down payment:
- Anyone who profits from the sale. The seller, agents, builders, lenders, and anyone else who benefits from the sale, directly or indirectly, can’t pay any of your down payment.
- Credit card advances and loans against personal property. A cash advance, or a loan against a car, collectibles, or other personal belongings, can’t be used for your down payment.
- A private second mortgage. A second loan from a private individual or company, other than a family member, doesn’t count toward your down payment.
- Unsourceable funds. Funds whose origin cannot be sourced cannot be used toward down payment or closing.
Money you spend on closing costs, prepaid items, and other fees doesn’t count toward your minimum down payment either, under HUD’s closing cost guidance. Those costs are paid on top of it.
How Your Down Payment Changes FHA Mortgage Insurance
Every FHA loan carries a mortgage insurance premium (MIP), which protects the lender if the loan isn’t repaid, regardless of what you put down. The upfront premium is 1.75% of the base loan. The annual premium, paid in monthly installments, depends on your loan-to-value ratio, which is the base loan divided by the home’s value.
On a $430,000 home with a loan term longer than 15 years, HUD’s premium schedule sets these amounts:
| Down payment | Cash down | Base loan | Upfront premium | Annual premium rate | First-year annual premium | How long the annual premium lasts |
|---|---|---|---|---|---|---|
| 3.5% | $15,050 | $414,950 | About $7,260 | 0.55% | About $2,280 | Life of the loan |
| 5% | $21,500 | $408,500 | About $7,150 | 0.50% | About $2,040 | Life of the loan |
| 10% | $43,000 | $387,000 | About $6,770 | 0.50% | About $1,940 | 11 years |
Putting 5% down instead of 3.5% lowers the annual premium rate from 0.55% to 0.50%. A 10% down payment matters more, because the annual premium then ends after 11 years instead of lasting for the life of the loan.
The dollar amounts are for the first year. HUD recalculates the premium each year on your average loan balance, so the amount falls as you pay the loan down. If your base loan is above $726,200, the annual premium rate is higher, at 0.70% to 0.75%.
The Homeowners Protection Act, which lets borrowers cancel private mortgage insurance on most conventional home loans, doesn’t cover FHA loans. The down payment you choose at closing sets how long you pay the annual premium.
The other ways off FHA mortgage insurance are selling the home, paying off the loan, or refinancing into a loan without it. A refinance starts a new loan term and depends on your credit, income, and home value at that time. Our guide to FHA mortgage insurance covers the full premium schedule.
Is FHA or Conventional Better With a Small Down Payment?
A conventional loan starts at 3% down for first-time buyers and HomeReady borrowers and at 5% otherwise. Its private mortgage insurance (PMI) is priced by your credit score, while FHA’s premium is the same at any score. Here’s how 3.5% down FHA and 5% down conventional compare on a $430,000 home:
| FHA, 3.5% down | Conventional, 5% down | What it means for you | |
|---|---|---|---|
| Cash for the down payment | $15,050 | $21,500 | FHA takes $6,450 less at closing |
| Upfront mortgage insurance | About $7,260, this is typically financed* | None | FHA adds a one-time premium to your loan balance |
| Annual mortgage insurance, 740 to 759 score | About $2,280* | About $1,800* | Conventional costs about $480 less a year |
| Annual mortgage insurance, 680 to 699 score | About $2,280* | About $3,020* | FHA costs about $740 less a year |
*NOTE: These are estimates and are for example purposes only. Your actual private mortgage insurance (PMI) cost will vary. Contact us for a personalized quote.
The annual mortgage insurance costs shown above don’t include FHA’s upfront premium. If you finance the upfront premium, your FHA loan starts at about $422,210. That’s about $13,710 more than the $408,500 conventional loan, with $6,450 from the smaller down payment and about $7,260 from the premium.
With conventional loans, you can ask to cancel PMI once your balance reaches 80% of the home’s original value. You’ll need a written request, current payments, a good payment history, no other loans on the home, and no drop in its value. PMI ends automatically when your balance is scheduled to reach 78% of the original value, if your payments are current, according to the Consumer Financial Protection Bureau.
If you or a co-borrower is a first-time buyer, a fixed-rate conventional loan on a one-unit home you’ll live in also allows 3% down. On a $430,000 home, that’s $12,900, or $2,150 less than FHA’s minimum. PMI costs more at 3% down than at 5%. It’s about $2,290 a year at a 740 to 759 score and about $3,750 at 680 to 699.
With a score of 740 to 759 and 5% saved, conventional costs less for mortgage insurance and has no upfront premium. If your score is lower, FHA can be the better fit, since its premium doesn’t rise with a lower score.
Our FHA vs. conventional guide for first-time buyers goes deeper on the choice, and our overview of how much down payment you need in general compares every loan type.
How Much Cash You Need Beyond the Down Payment
The down payment isn’t the only cash you’ll need. Plan for these as well:
- Closing costs and prepaid items. Lender fees, title and escrow charges, and prepaid property taxes and insurance. Your Loan Estimate, which your lender must send within three business days of your application, lists each one to show a total estimated cash due at closing.
- Earnest money. It’s due soon after your offer is accepted, weeks before closing, so the cash has to be ready early. This deposit is credited toward your down payment and closing costs when you close.
- The upfront premium, if you pay it at closing. On a $430,000 home, that’s about $7,260. Most often, we see clients elect to include this in their financing rather than pay out of pocket.
- Money after closing. Cash for moving and early repairs comes out of what’s left after the down payment and closing costs.
The seller and others who profit from the sale, such as the builder or an agent, can pay some of your costs via an interested party contribution. HUD’s seller contribution rules cap that help at 6% of the sales price, toward closing costs, prepaid items, discount points (upfront fees that lower your interest rate), and the upfront premium. On a $430,000 home, that’s up to $25,800, limited to your actual costs, and none of it can go toward your minimum down payment. This is something that would have to be negotiated into your terms with your agent, lender and/or seller.
Our guide to seller credits on FHA closing costs walks through how they work in a purchase contract, and our guide to seller concessions covers how to negotiate them.
How We Help You Plan an FHA Loan Down Payment
We work through your FHA loan down payment with you before you write an offer:
- Confirm the score that counts. We pull your credit and find the middle score HUD will use for you and any co-borrower.
- Check your county’s FHA limit. We match your price range to the limit, so you know whether 3.5% down works at your price or you’ll need more.
- Map every source of funds. Savings, gifts, and assistance each need different paperwork, and we line up gift letters and transfer records before your contract deadlines.
- Put FHA and conventional side by side. We put together actual estimates for both options based on your credit score, so you see the down payment, mortgage insurance, and cash to close for each.
- Issue your pre-approval once you qualify. Once we confirm your best loan structure, we issue your pre-approval letter reflecting the loan and down payment you choose, so your offer matches your financing.
When you’re ready to apply, our five-step guide to applying for an FHA loan covers the rest of the process.
View mortgage rates for November 4, 2026
Frequently Asked Questions
What is the FHA minimum down payment in 2026?
The FHA minimum down payment in 2026 is 3.5% of the home’s price or appraised value, whichever is lower, with a credit score of 580 or higher. HUD requires 10% down with a credit score from 500 to 579, although lenders can require a higher score, and our FHA minimum is 580. On a $430,000 home, 3.5% down is $15,050.
Can my entire FHA down payment be a gift?
Yes. HUD doesn’t require any part of the FHA down payment to come from your own savings, so a gift can cover all of it. The gift must come from a family member, employer or labor union, close friend with a clearly defined and documented relationship with you, charitable organization, or government homebuyer program. It also needs a signed gift letter and proof of the transfer.
Can the seller pay my FHA down payment?
No. The seller, real estate agents, builders, lenders, and anyone else who profits from the sale can’t provide any of the FHA down payment. An interested party can pay up to 6% of the sales price toward your actual closing costs, prepaid items, discount points, and upfront mortgage insurance premium.
Do closing costs count toward the FHA down payment?
No. Closing costs, prepaid items, and other fees are paid on top of the FHA down payment and don’t count toward the minimum. A seller credit, lender credit, or gift can help cover closing costs.
Does a bigger down payment lower FHA mortgage insurance?
Yes, at 5% down and again at 10% down. On a loan term longer than 15 years with a base loan up to $726,200, putting at least 5% down lowers the annual FHA mortgage insurance premium from 0.55% to 0.50%. Putting at least 10% down ends the annual premium after 11 years instead of keeping it for the life of the loan.
What happens if an FHA appraisal comes in low?
If an FHA appraisal comes in below the purchase price, the maximum FHA loan is based on the lower appraised value, so closing at the same price takes more cash. When the purchase contract was signed before the appraisal, FHA requires an amendatory clause that may allow you to cancel without losing your earnest money if the appraisal is below the price. Some sales, including HUD-owned homes and foreclosure sales, don’t require the amendatory clause.
Can I use down payment assistance with an FHA loan?
Yes. Down payment assistance from a government agency or housing finance agency can cover some or all of the FHA down payment, as a grant or as a second loan. A second mortgage from a private individual or company, other than a family member, can’t be used toward the FHA minimum down payment.
Ready to See Your FHA Down Payment?
Your FHA down payment depends on your credit score and your county’s loan limit, and a gift can cover all of it. A pre-approval shows your down payment and total cash to close before you make an offer.
Get pre-approved with JVM Lending to see your FHA down payment next to your conventional options.
If you’re still saving or waiting on a gift, we can help you plan where each dollar of your down payment will come from before you start house hunting. Call or text (855) 855-4491 or email hello@jvmlending.com.
NOTE: All figures in this post are examples for illustrative purposes only.
