According to a study from Bankrate, about 43 percent of U.S. millennials say they can’t afford to purchase a home because of the down payment and closing costs. For younger first time home buyers that are able to make a down payment on a house, many of them receive assistance from their parents. According to LendingTree, 78 percent of Gen Z homeowners have received financial support for a down payment, while 54 percent of millennials have.

A lot of potential homeowners think that they need to make the traditional 20% down payment to get into a home, but that’s just not the case anymore.

Become a first time home buyer without a down payment

At Arsenal, a qualified first time home buyer could receive assistance for part or all of a down payment. Home$tart is a down payment and closing cost assistance program offered by Federal Home Loan Bank of Des Moines (FHLB). Learn more about how you can take advantage of this program and get over the down payment hurdle.

Learn more

How much is the average down payment?

Now that we’ve established that a 20 percent down payment isn’t necessary, what can you expect to pay? It’s easy to figure out. Let’s take the median home price in the Midwest of $293,300 and do a little basic math.

3 percent down$8,799
3.5 percent down$10,266
5 percent down$14,665
13 percent down$38,129
20 percent down$58,660

How much should a first time home buyer put down on a home?

The amount you put down on a home depends on your unique situation. The more you’re able to put down as a first time home buyer, the higher your chances of approval are. You’ll also potentially avoid having to provide mortgage insurance and have more room for your budget to breathe with a lower monthly payment. A larger down payment can also help you build more equity in your home if you choose to borrow with a home equity loan or line of credit in the future.

However, a smaller first time home buyer down payment may let you buy a more expensive home. Making a smaller down payment (if coming from your own savings) lets you invest those funds elsewhere and possibly see a larger return on it.

Ultimately, the decision is yours. We’re here to help guide you through your mortgage journey. Feel free to contact us with any questions and we’ll be happy to help.

Contact an Arsenal mortgage expert

  • Start a live chat during normal business hours
  • Email the mortgage team at
  • Contact Mortgage Loan Originator, Jon DeBold, at 636.575.0678.

Recommended articles