How Much Is an FHA Loan Down Payment?

An FHA loan is a mortgage insured by the Federal Housing Administration. One of the key benefits of FHA loans is that they have lower down payment requirements than conventional loans. You can also use funds other than your savings to pay for a down payment on an FHA loan, such as gift money from family or a down payment assistance program.

Before applying for an FHA loan, you should know the minimum down payment requirements for an FHA loan, the variables that impact your down payment size, and the various ways you can source your down payment funds.

Minimum down payment for a FHA loan

The minimum down payment for an FHA loan is 3.5% of the purchase price. However, some FHA borrowers may need at least a 10% down payment if their credit score is less than 580 or up to 15% down if using the FHA loan to buy a home from someone they know (e.g. an identity of interest transaction).

Let’s assume you’re interested in buying a house with a $375,000 FHA mortgage loan. If you have a credit score of 580 or higher, your down payment will likely be $13,125 (3.5%). However, if your credit score is 579 or below, your down payment on the same house may be $37,500 (10%). 

FHA loan down payment requirements 

Borrowers can qualify for an FHA loan with a credit score as low as 500 when they make a 10% down payment. To qualify for the minimum FHA loan down payment of 3.5%, borrowers may need a credit score of 580 or above. To be eligible for an FHA loan, you may need to meet other lending criteria, such as:

Debt-to-income (DTI) ratio: Borrowers need a front-end ratio no higher than 31% of their gross monthly income, or a back-end ratio no higher than 43% of their gross monthly income. 

Loan limits: Home price limits for FHA loans vary by location. As of 2025, borrowers in lower cost areas must choose a single-family house that costs $524,225 or less. In higher cost areas, the maximum house price that can qualify for a FHA loan can range between $524,225 and $1,209,750, depending on location.

Property requirements: The property being bought must be the borrower’s primary residence and meet FHA minimum property standards.

Appraisal requirements: An FHA-approved appraiser must appraise the property, and the appraised home price must meet or exceed the purchase price to qualify for FHA financing. 

How to save for an FHA loan down payment

The most common source of down payment funding comes from savings. According to a 2024 Zillow survey, 72% of mortgage buyers reported saving up for their down payment over time. With higher home sale prices, the cost of a down payment continues to increase, prompting alternative ways to save up for a down payment. Here are some strategies you can implement to secure a down payment for an FHA loan.

• Open up a designated down payment savings account that you can’t access for at least 6 months, and set up automatic transfers from your checking account every pay period. 
• Consider moving existing savings into a money market account, certificate of deposit, or high-yield savings account that offers 4-5% APY.
• Temporarily redirect retirement and investment contributions to your down payment savings account until you’ve purchased a home. However, be careful not to compromise your emergency fund. 
• Consider side gigs such as food delivery, grocery delivery, or freelancing.
• Negotiate a salary raise and ask about work bonuses. 
• Explore grants and matched savings programs. Zillow displays locally available down payment assistance programs on all listings, cutting down timing wading through a host of government websites.   

FHA loan down payment gift rules

In addition to creating a savings plan, you can also ask friends and family to gift you all, or at least a portion of your down payment. Down payment gifts make it easier for your loved ones to contribute to your homeownership journey. Thirty-eight percent of mortgage buyers reported using a gift or loan from family or friends to finance their down payment.

However, there are a few rules governing who can and can’t provide you with down payment gifts, and a gift letter is typically required to verify the funds. These restrictions exist to protect buyers from predatory lending and financial abuse. Buyers can’t receive gifts from anyone with a financial interest in the home-buying transaction, such as lenders, builders, sellers, or agents. 

FHA borrowers can receive a down payment gift from:

• A family member
• An employer or labor union
• A charitable organization
• A close friend with a clearly defined interest in the borrower
• A government agency assisting first-time homeowners or low-income families

FHA loan down payment assistance programs

If you’re struggling to come up with down payment funds, you might qualify for a down payment assistance program. First-time homebuyers that finance with a mortgage are more likely to report getting down payment assistance (60%) versus repeat buyers (43%).

These programs are designed to help homebuyers pay for their down payment through matched savings programs, loans, and grants. Eligibility for these programs depends on income and location. Here are some programs buyers can explore.

National Homebuyers Fund

The NHF is a nonprofit organization that helps cover down payment and closing costs. Buyers can receive up to 5% of their final loan amount as a grant, or obtain a second mortgage loan at a 0% interest rate that can be forgiven after 3 years. 

HUD's Good Neighbor Next Door Program

The Department of Housing and Urban Development (HUD) provides select buyers up to 50% off of a home’s list price in specific areas, which reduces the buyer’s down payment size. This program is designed specifically for teachers, law enforcement officers, and emergency personnel. 

Government programs

Several states partner with local governments and housing authorities to offer down payment assistance. HUD maintains a database of local home buying assistance programs organized by state. Take a look at some of these programs, below.

Local First-Time Homebuyer Programs (City & County): 

• The Chicago Home Buyer Assistance Program helps Chicago homebuyers cover down payments and closing costs.
• The Dallas Homebuyer Assistance Program provides first-time buyers up to $40,000 in the form of a forgivable loan. 

State Housing Finance Agency (HFA) Programs (State Level):

• The California Housing Finance Agency (CalHFA) provides deferred payment loans that can be applied toward down payments and closing costs through the MyHome Assistance Program. 
• The New York State Homes and Community Renewal offers low- and moderate-income first-time homebuyers with a 0% down payment assistance loan that can be forgiven after 10 years. 

Additional costs to consider with an FHA loan

In addition to a down payment, FHA borrowers also need to pay for closing costs and insurance premiums. 

FHA closing costs

Closing costs on FHA loans are usually 3-6% of the home’s total purchase price. If you’re buying a home worth $350,000, you can expect to pay between $10,500 and $21,000 in closing costs. If this sum seems overwhelming, don’t worry, many down payment assistance programs can also be used for closing costs. 

FHA mortgage insurance premiums (MIP)

Mortgage borrowers are required to pay mortgage insurance on FHA loans to protect the lender if the borrower defaults on their loan. FHA loans have two forms of mortgage insurance premiums (MIP): an upfront premium and an annual premium. 

The upfront premium is 1.75% of the total loan amount and can be paid in cash at closing or rolled into your monthly mortgage payment. The annual premium ranges from 0.15%-0.75% of the loan amount and is split into monthly payments. You can lower your annual MIP payment by making a larger down payment when you close on the loan, or by refinancing into a conventional loan at a later date.

FHA loan alternatives 

An FHA loan may not be ideal for every borrower. If you’re curious to learn what types of loans you qualify for with us at Zillow Home Loans*, our loan officers are available to help. Here are some financing options with similar benefits and loan terms to FHA loans. 

• Conventional 97 loans provide first-time homebuyers and buyers who haven’t owned a home in the past three years mortgage loans with as little as 3% down. 
• VA loans provide eligible veterans, active-duty service members, and military spouses mortgage loans with 0% down and no mortgage insurance payments.  
• USDA loans provide buyers in rural areas mortgages with 0% down, as long as specific income limits and property requirements are met. 
• HomeReady and Home Possible programs provide mortgage loans with flexible underwriting criteria and just 3% down to low-income borrowers.

*An equal housing lender. NMLS #10287

The information provided in this article is for educational purposes only and is not intended to provide legal, financial, or other professional advice.