How Much Down Payment Do I Need to Buy a Home?

It’s been a perception for so long that buying a house requires a 20% down payment — you might be thinking, “when pigs fly!” Luckily, we don’t have to wait for that day, because the truth, according to the National Association of Realtors, is that low down payments for first-time home buyers are the new normal. The average buyer does actually put 6% down right now — no magic animals involved.

But why, and how?

Let’s look back in history. Home prices were less expensive for our grandparents (and parents), so a 20% down payment wasn’t as large back then. According to the U.S. Census, the average cost of a home in the 1970s was only $65,600 (this amount considers inflation and is adjusted to current year dollars). That’ll barely buy a bedroom these days. 

According to Zillow, the average cost of a home in 2021 is $269,039.

With home prices rising steadily over the past few decades, everyone realized that buying a house would only be an option for people with wealth. So, the industry swerved to make homeownership as possible for us today as it was back then.

For example, if you like a house that’s $200,000, a 6% down payment would be $12,000. Or, sometimes you can put down as low as 3%, which would be $6,000. 

If even a 3-6% down payment still feels steep, you’re not alone. Coming up with thousands of dollars, on top of keeping up with monthly bills, can be hard for anyone, but that’s why there are many ways you could lower the total cash needed to buy a home. 

Down Payment Assistance Programs

To help, government programs and private lenders offer down payment assistance programs to help home buyers on their journey towards homeownership. These programs often change, so if you’re interested, contact our sales center to be put in touch with someone who can walk you through your options.

Zero Down

Zero-down payment options are available for well-qualified buyers. This means if you have a high credit score, you could find even more savings. If you don’t have a great credit score, that’s okay. It might still be possible to buy a house, qualify for a lower down payment and work with a payment assistance program. 

Mortgage Insurance 

We’ve talked about why lower down payments are the new normal, let’s talk about how it’s possible. Mortgage Companies want to protect their investment. That’s where mortgage insurance comes into play.

Mortgage insurance is usually required with a down payment of less than 20%, and it’s included in the monthly payment, so you pay a little bit each month over time.

Mortgage insurance is a win-win. It allows lenders to qualify borrowers with lower down payments while also insuring themselves from potential losses, resulting in homeownership being possible for more and more people.

Starlight Advantage Program 

At Starlight, we build and sell high-quality homes across the country with the mission of making the buying experience simple and accessible. To help with that, our Starlight Advantage Program was designed to offset the total cost of buying a home. Through this program, we’ll contribute a set amount of dollars to help with your closing costs, which will ultimately lower the amount of dollars out of your pocket.

Ready To Talk?

If you’re interested in seeing if you qualify for the Starlight Advantage Program when you buy one of our new, move-in ready homes, you can schedule an appointment with one of our Home Guides. They’ll be happy to talk to you about your options. Get in touch with a Starlight representative today to set up an appointment to tour a home and to talk about your financial options.


This communication is provided to you for informational purposes only and should not be relied upon by you. Starlight Homes does not offer loans or mortgages. Starlight Homes is not a lender or a mortgage broker. Contact Velocio Mortgage directly to learn more about its mortgage products and your eligibility for such products. The mortgage program information is not to be construed as a quotation or offer of credit from any lending institution. Programs, rates, terms and conditions are subject to change at any time without notice. Actual rates available to you may vary based upon a number of factors including your credit rating, documentation level, and market conditions. Income, geographic, and/or other restrictions may apply to $0 down financing. See terms and conditions for complete information. All loans are subject to credit approval. Other restrictions may apply.


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