The down payment is a smaller piece than you think
The 20 percent down myth needs to die. It's outdated, it's wrong, and it's stopping a lot of people from buying houses they could afford right now.
Here's what real down payment minimums look like in 2026:
FHA loan: 3.5 percent minimum (with 580+ credit)
Conventional 97: 3 percent for first-time buyers
VA loan: 0 percent for active military and veterans
USDA loan: 0 percent for designated rural areas
Jumbo loan: typically 10 to 20 percent
Most first-time buyers in 2026 put down between 3 and 7 percent. The median first-time buyer down payment is closer to 6 percent than 20.
On a $350,000 home, here's what those minimums look like:
3 percent: $10,500
3.5 percent: $12,250
5 percent: $17,500
10 percent: $35,000
20 percent: $70,000
The catch with putting less than 20 percent down: you'll pay mortgage insurance. On an FHA loan, it's $150 to $250 per month. On a conventional loan with PMI, it's similar but drops off automatically when you hit 20 percent equity. Factor that into your monthly budget, but don't let it scare you away from buying.
Closing costs (the part nobody warned you about)
Closing costs are a big surprise for first-time buyers. They run 2 to 5 percent of the loan amount and they're due at closing, the same day you wire your down payment. So plan accordingly.
What's included:
Lender fees: origination, underwriting, processing. Usually 0.5 to 1.5 percent of the loan amount.
Title insurance: protects against title issues. Florida averages around $1,000 to $2,500 depending on price.
Title search: $150 to $400.
Appraisal: $500 to $700, paid upfront before closing in most cases.
Home inspection: $400 to $700, paid before closing.
Property taxes: prorated, sometimes a few months prepaid into escrow.
Homeowners insurance: Florida hits buyers hard here. $2,000 to $15,000 for the first year, paid at closing.
Recording fees and transfer taxes: $200 to $1,000 depending on the county.
Prepaid interest: the interest from your closing day to the first of the next month.
On a $350,000 home, expect $7,000 to $17,500 in closing costs. The Florida insurance line is what blows up the high end of that range. Inland properties land closer to the bottom. Coastal South Florida or post-Ian Cape Coral land toward the top.
The down payment is a smaller piece than you think
The 20 percent down myth needs to die. It's outdated, it's wrong, and it's stopping a lot of people from buying houses they could afford right now.
Here's what real down payment minimums look like in 2026:
FHA loan: 3.5 percent minimum (with 580+ credit)
Conventional 97: 3 percent for first-time buyers
VA loan: 0 percent for active military and veterans
USDA loan: 0 percent for designated rural areas
Jumbo loan: typically 10 to 20 percent
Most first-time buyers in 2026 put down between 3 and 7 percent. The median first-time buyer down payment is closer to 6 percent than 20.
On a $350,000 home, here's what those minimums look like:
3 percent: $10,500
3.5 percent: $12,250
5 percent: $17,500
10 percent: $35,000
20 percent: $70,000
The catch with putting less than 20 percent down: you'll pay mortgage insurance. On an FHA loan, it's $150 to $250 per month. On a conventional loan with PMI, it's similar but drops off automatically when you hit 20 percent equity. Factor that into your monthly budget, but don't let it scare you away from buying.
Closing costs (the part nobody warned you about)
Closing costs are a big surprise for first-time buyers. They run 2 to 5 percent of the loan amount and they're due at closing, the same day you wire your down payment. So plan accordingly.
What's included:
Lender fees: origination, underwriting, processing. Usually 0.5 to 1.5 percent of the loan amount.
Title insurance: protects against title issues. Florida averages around $1,000 to $2,500 depending on price.
Title search: $150 to $400.
Appraisal: $500 to $700, paid upfront before closing in most cases.
Home inspection: $400 to $700, paid before closing.
Property taxes: prorated, sometimes a few months prepaid into escrow.
Homeowners insurance: Florida hits buyers hard here. $2,000 to $15,000 for the first year, paid at closing.
Recording fees and transfer taxes: $200 to $1,000 depending on the county.
Prepaid interest: the interest from your closing day to the first of the next month.
On a $350,000 home, expect $7,000 to $17,500 in closing costs. The Florida insurance line is what blows up the high end of that range. Inland properties land closer to the bottom. Coastal South Florida or post-Ian Cape Coral land toward the top.
The other costs that catch you
Once you've covered the down payment and closing costs, there's a third category most buyers forget about until they're at closing.
Earnest money deposit: 1 to 3 percent of the purchase price, paid when your offer is accepted. It gets credited toward your closing costs at closing, so it's not extra money out of pocket, but it does come out of your bank account 30 to 45 days before closing.
Moving costs: $500 to $5,000. Local moves are cheaper. Cross-country with a family of four can hit five figures.
Immediate repairs and upgrades: budget $1,000 to $5,000 for the stuff you'll fix in the first month. Painting, locks, fixtures, the appliance the seller said they'd leave but didn't.
Cash cushion after closing: you do not want to be tapped out the day you move in. Water heaters die. AC compressors quit. Roofs leak. Have at least 1 to 2 months of mortgage payments in reserve, ideally three.
That's another $5,000 to $15,000 you'll want available, even though it's not strictly required by the lender.
The real number, end-to-end
Let's put it all together on a $350,000 Florida home with 5 percent down:
Down payment (5 percent): $17,500
Closing costs (3 percent of loan): $9,975
Home inspection: $500
Appraisal: $600
Moving costs: $2,000
Initial home costs (paint, repairs): $2,500
Cash cushion: $7,000
Total cash needed at closing or shortly after: roughly $40,000.
Earnest money is included in the closing-cost line because it gets credited back at closing.
That's the real number. If anyone tells you that you can buy a $350,000 home with $12,000 saved up, they're either talking about an unusual scenario (VA loan, full DPA stack) or they're not telling you about the closing-day surprise.
How to bring that number down
Here's the part the bank doesn't always volunteer. There are five legitimate ways to reduce how much cash you need at closing.
1. Down payment assistance programs
Florida runs several. Florida Housing's HFA Preferred Grant gives you 3 percent of the home price as a non-repayable grant. Florida Assist provides up to $10,000 as a 0 percent deferred second mortgage. Counties layer their own programs on top. Broward County alone has up to $50,000 in DPA available for qualifying buyers.
If you're a first-time buyer in Florida and you haven't checked your DPA options, you're leaving money on the table.
2. Seller concessions
Sellers can credit you up to 3 to 6 percent of the home price toward your closing costs (the cap depends on loan type and down payment). In a softening market like Florida's in 2026, asking for $5,000 to $10,000 in seller concessions is realistic and not unusual.
3. Lender credits
The lender can give you a credit toward closing costs in exchange for a slightly higher rate. It's not free money, but it can shift cash from closing day to spread out over the life of the loan. Useful if you're cash-strapped at closing.
4. Gift funds
Family can give you down payment money. Each lender has rules about how it has to be documented (usually a "gift letter"), but most loan types accept it.
5. Commission rebates
This one is recent and underused. Rebate brokerages like Homa rebate part of the seller-paid commission back to you at closing. The average Homa buyer gets $10,560 credited at closing. You can take it as cash, apply it to closing costs, or use it for a mortgage rate buydown.
On the same $350,000 home above, a Homa rebate could effectively cover most of your closing costs, dropping the cash needed from $40,000 to closer to $30,000.
