dopecalc

Down Payment Calculator

Calculate your down payment amount, loan amount, and understand PMI requirements for a home purchase.

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About this Calculator

Calculate your down payment amount, loan amount, and understand PMI requirements for a home purchase.

Formula & Calculations

Formula

Down Payment = Home Price × Down Payment % / 100, Loan Amount = Home Price - Down Payment
Where:
  • HP=Total home purchase price
  • DP%=Down payment percentage of the home price
  • DP=Down payment amount in dollars
  • LA=Loan amount after subtracting the down payment
  • LTV=Loan-to-Value ratio (Loan Amount / Home Price × 100)

Assumptions

  • PMI (Private Mortgage Insurance) is typically required when the down payment is less than 20%.
  • Does not include closing costs, property taxes, or homeowners insurance.
  • Down payment calculations are based on the purchase price only.

Calculation Examples

Example 1

Inputs:Home Price: $400,000, Down Payment: 20%
Result:Down Payment: $80,000, Loan Amount: $320,000, LTV: 80%

With 20% down on a $400,000 home, you borrow $320,000 and avoid PMI since the LTV is exactly 80%.

Example 2

Inputs:Home Price: $300,000, Down Payment: 10%
Result:Down Payment: $30,000, Loan Amount: $270,000, LTV: 90%

A 10% down payment means you only put $30,000 down. PMI will be required because the LTV is above 80%.

Example 3

Inputs:Home Price: $250,000, Down Payment: 5%
Result:Down Payment: $12,500, Loan Amount: $237,500, LTV: 95%

With only 5% down, PMI is mandatory. Many first-time homebuyer programs allow as little as 3-5% down.

Frequently Asked Questions

How much down payment do I need for a house?

Conventional loans typically require 3-20% down. A 20% down payment lets you avoid Private Mortgage Insurance (PMI). FHA loans may require as little as 3.5% down, while VA and USDA loans can offer 0% down for qualified borrowers.

What is PMI and how can I avoid it?

PMI (Private Mortgage Insurance) protects the lender if you default. It typically costs 0.5-1% of the loan amount annually. You can avoid PMI by putting at least 20% down, or it automatically cancels once your LTV reaches 78% through payments.

Should I put 20% down or invest the difference?

This depends on your financial goals and the interest rate environment. If your mortgage rate is low, investing the extra money might yield higher returns. However, a 20% down payment guarantees PMI elimination and lower monthly payments.