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title: “FHA Loan Down Payment: Everything You Need to Know” ogImage: “/og/satori/fha-loan-down-payment-guide.png” description: “Complete guide to FHA loan down payment requirements, including the 3.5% minimum, acceptable sources of down payment funds, and how down payment affects your total loan cost.” pubDate: 2026-03-17 faqSchema:

• question: “What is the minimum down payment for an FHA loan?” answer: “The minimum down payment for an FHA loan is 3.5% of the purchase price with a credit score of 580 or higher. With a score of 500-579, the minimum increases to 10%.”
• question: “Can I use gift funds for my FHA down payment?” answer: “Yes, FHA allows the entire down payment to come from gift funds provided by family members, employers, charitable organizations, or government agencies. The donor must provide a gift letter.”
• question: “How much is a 3.5% down payment on a $300,000 home?” answer: “A 3.5% down payment on a $300,000 home is $10,500. Your loan amount would be $289,500, plus the FHA upfront mortgage insurance premium of 1.75%.”
• question: “Can I use a down payment assistance program with an FHA loan?” answer: “Yes, many down payment assistance programs are designed specifically for FHA loans. These include state and local grants, second mortgages, and tax credit programs like Mortgage Credit Certificates.”
• question: “Is it better to put more than 3.5% down on an FHA loan?” answer: “Putting 10% or more down reduces your annual MIP from 0.55% to 0.50% and shortens the MIP term from the life of the loan to 11 years, saving significant money over time.”---

Quick Answer

FHA loans require a minimum down payment of 3.5% with a credit score of 580 or higher, or 10% with a score of 500-579. Unlike conventional loans that often require 5-20% down, FHA loans make homeownership accessible with very little upfront cash, and they allow gift funds and down payment assistance programs to cover the entire amount.

Key Takeaways

• Minimum 3.5% down payment with a 580+ credit score
• 10% down payment required for credit scores 500-579
• Gift funds from family members are 100% acceptable for down payment
• Down payment assistance programs can cover the entire 3.5%
• Putting 10%+ down changes your MIP terms significantly

Down Payment Amounts by Home Price

Here is what the minimum 3.5% down payment looks like at various price points:

Home Price	3.5% Down	Loan Amount
$200,000	$7,000	$193,000
$300,000	$10,500	$289,500
$400,000	$14,000	$386,000
$500,000	$17,500	$482,500

Remember that closing costs are separate from the down payment and typically add 2-5% to your total upfront costs.

Acceptable Sources of Down Payment

FHA loans are very flexible about where your down payment money comes from:

• Savings and checking accounts
• Gift funds from family, employers, or charitable organizations
• Down payment assistance programs (grants and second mortgages)
• Retirement account withdrawals (401k loans, IRA first-time buyer exception)
• Proceeds from selling assets (with documentation)
• Employer assistance programs

How Down Payment Affects MIP

Your down payment amount directly impacts your mortgage insurance costs:

3.5-9.99% down: Annual MIP of 0.55%, required for the entire loan term 10% or more down: Annual MIP of 0.50%, required for only 11 years

This is a crucial distinction. Putting an extra 6.5% down (to reach 10%) could save you thousands in mortgage insurance over the life of the loan. Use our FHA vs Conventional Calculator to model different down payment scenarios.

Down Payment Assistance Programs

Many state and local governments offer programs that can cover your entire down payment:

• Grants that do not need to be repaid
• Silent second mortgages with no payments until you sell
• Forgivable loans that are forgiven after a set period
• MCC (Mortgage Credit Certificates) for annual tax savings

Check with your state housing finance agency for available programs.

Comparing Down Payment Strategies

For a detailed comparison of how different down payment amounts affect your total cost of homeownership, see our first-time homebuyer guide and FHA MIP vs PMI comparison.