Updated October 6, 2026.
Your first mortgage does not have to require a 20% down payment. Some conventional loans allow a smaller down payment, FHA has a low-down-payment option, and eligible VA or USDA borrowers may qualify for financing without one.
The best choice depends on your eligibility, the home, the money available at closing and the payment you can comfortably carry. A smaller down payment does not automatically make a loan cheaper. Compare the full written quotes before choosing.
Which loan options should you compare?
Conventional: ask about low-down-payment programs
Some conventional programs allow as little as 3% down for eligible borrowers. For example, Fannie Mae's HomeReady program has income and other eligibility requirements and can serve eligible first-time or repeat buyers. Not every conventional loan or borrower qualifies for 3% down.
Ask the lender whether private mortgage insurance, or PMI, is required, what it costs and when it can end. For many eligible conventional mortgages, cancellation depends on the loan balance and other conditions; a rise in home value does not automatically remove it. See the CFPB's PMI cancellation explanation.
FHA: compare the down payment with mortgage-insurance costs
FHA-insured loans can allow a 3.5% down payment for qualifying borrowers. They are not limited to first-time buyers. Ask the lender about credit requirements, eligible income, the property's condition and the upfront and ongoing mortgage-insurance charges. HUD's FHA guidance explains the low-down-payment option and several eligibility misconceptions.
For FHA case numbers assigned on or after June 3, 2013, the duration of monthly mortgage-insurance payments depends on the loan-to-value ratio at origination. With more than 90% loan-to-value, it generally lasts for the loan term; at 90% or less, it generally lasts 11 years. Ask how that applies to your proposed loan and compare the full cost with a conventional quote. See HUD's mortgage-insurance duration rules.
VA: check service eligibility and cash to close
If you meet the service or surviving-spouse eligibility requirements, a VA-backed purchase loan may allow no down payment and has no monthly mortgage-insurance charge. You still need a COE and lender approval, and you must meet occupancy requirements. Read the VA purchase-loan requirements.
No down payment does not eliminate closing expenses. A funding fee may apply unless you qualify for an exemption. Ask about that fee, prepaid expenses, any agent compensation you owe and the total cash needed. Our VA loan myth guide explains those distinctions.
USDA: check the address as well as household eligibility
The USDA Single Family Housing Guaranteed Loan Program can provide 100% financing to eligible borrowers buying an eligible rural primary residence. Household income and the property address matter. Do not assume that every home outside Wichita, or every home in a nearby town, qualifies.
Use the address and income tools linked from USDA's program page, then ask an approved lender to confirm eligibility and all upfront and ongoing charges. The down payment is only one part of the cost.
How much would the down payment be?
For a hypothetical $250,000 purchase, 3% is $7,500, 3.5% is $8,750 and 20% is $50,000. These are arithmetic examples, not offers of financing. Your required contribution depends on the loan and your approval.
Budget separately for closing costs, prepaid taxes and insurance, inspections, moving and money left for repairs. Ask the lender for cash to close: the estimated amount you need to bring to settlement after deposits, credits and other adjustments. Do not spend your entire reserve just to reach a larger down payment.
Does “first-time buyer” mean you have never owned a home?
The definition varies by loan or assistance program. A program may look at recent ownership rather than lifetime ownership, and exceptions may apply. Ask the lender which written definition governs the option they are recommending. FHA and VA benefits are not reserved solely for first-time buyers.
Is down-payment assistance free money?
It may be a grant, a forgivable loan or a repayable second loan. Those arrangements can have different income limits, property restrictions, education requirements and rules if you sell, move or refinance. Availability and funding can change.
Before counting on assistance, ask for the current program terms: Who provides it? Is it open? Who qualifies? Must you use a participating lender? When is repayment due? What could prevent forgiveness? Have the lender show how the assistance changes your payment, closing cash and later obligations.
How do you compare lenders fairly?
Request Loan Estimates for the same purchase price, loan amount and term at roughly the same time. Check whether the interest rate is locked and whether the quotes include points or lender credits. Compare:
- The principal-and-interest payment and any mortgage insurance.
- Estimated taxes, homeowners insurance and association dues, including charges outside escrow.
- Origination fees, points and other closing costs.
- Cash to close and the savings you would have left afterward.
- Costs over the period you realistically expect to keep the loan.
The CFPB's Loan Estimate comparison guide walks through the form. Ask for a written explanation of any difference you do not understand. An advertised rate or a verbal estimate is not a completed approval.
What should you do before touring Wichita homes?
Set a comfortable total monthly payment, decide how much savings you want to keep and speak with lenders about the options you qualify for. Ask what income, asset, debt and credit documents they need; requirements depend on your circumstances and the program.
Once you have a working budget, browse Wichita homes or talk with Urban Cool Homes about your search. Your agent can help with the property search and purchase process. Your lender determines financing eligibility and loan terms.