How Much Do I Need for a Down Payment in Florida?

Key Takeaways - The 20% down payment rule is a myth — many programs require far less - FHA loans allow 3.5% down with a 580+ credit score - Conventional loans are available with as little as 3% to 5% down - Florida has state and county down payment assistance programs worth exploring - Putting less down means paying PMI, but the math sometimes still favors it One of the most persistent myths about buying a home is that you need 20% down. For a $400,000 home in Lantana or West Palm Beach, that would be $80,000 — a number that puts homeownership out of reach for many buyers. The reality is far more flexible. What you actually need by loan type Conventional loans: Fannie Mae and Freddie Mac both offer programs requiring only 3% down for first-time buyers who meet income limits. Standard conventional loans are available at 5% down with no income restrictions. With less than 20% down, you will pay private mortgage insurance (PMI), which typically adds $50 to $200 per month to your payment until you reach 20% equity. FHA loans: The Federal Housing Administration backs loans with as little as 3.5% down for buyers with credit scores of 580 or higher. On a $350,000 purchase, that is $12,250. FHA loans do carry mortgage insurance for the life of the loan (or until you refinance into a conventional loan), so factor that into the long-term calculation. VA loans: Eligible veterans and active military can buy with zero down payment. No PMI ever. This is one of the most powerful financial tools available to those who qualify, and many Florida veterans do not take full advantage of it. USDA loans: Rural development loans also allow zero down, and more Florida locations qualify than many buyers realize. Certain areas in St. Lucie, Okeechobee, and Hendry counties, among others, fall within eligible zones. Down payment assistance in Florida The Florida Housing Finance Corporation offers several programs designed to help buyers cover the down payment and closing costs: The Florida Assist program provides up to $10,000 in down payment assistance as a zero-interest, deferred second mortgage that does not have to be repaid until you sell, refinance, or pay off the first mortgage. The Florida HLP Second Mortgage provides up to $10,000 at 3% interest with a 15-year repayment term. Some counties in Southeast Florida — including Palm Beach and Broward — also have local programs layered on top of state assistance. Eligibility depends on income, purchase price limits, and whether you are a first-time buyer. Should you put down more if you can? There is no single right answer. Putting more down reduces your monthly payment, eliminates or reduces PMI sooner, and may get you a marginally better interest rate. But it also reduces the cash you have available for reserves, moving costs, and repairs on the new home. Many buyers in Southeast Florida find that a 5% to 10% down payment balances affordability with financial security better than stretching to 20%. The right number depends on your complete financial picture. A KP Funding loan officer will walk through the full breakdown with you — what each down payment amount costs per month, what PMI looks like, and what assistance programs you may qualify for — at no charge and with no obligation. KP Funding Corporation | NMLS #2442789 | Equal Housing Lender | Licensed in Florida | Not a commitment to lend. Rates subject to change.