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Busting the Myth About a Down Payment for a House

Owning A Home: The American Dream

Everybody has to pay to live somewhere. Some people rent, while others own their own home. Both are paying a mortgage, but there is one fundamental difference and it is a big one! The renter is paying for their landlord’s mortgage and is essentially helping them build their wealth. On the other hand, the homeowner is investing in their own future and building their own wealth. 

So if owning a home makes so much financial sense, why don’t more people own homes? The answer to that is not straightforward as there are many reasons that can keep someone from owning a home. However, there is one big myth, that keeps a lot of people from taking that first step toward their American Dream, and that is the myth of the down payment. 

Need more reasons to think about home ownership? Check out this article:

8 Reasons To Buy A House Instead of Renting

You Don't Need A 20% Down Payment

Just the other day I was getting my nails done, and my nail technician, a young lady in here late 20s said to me “It is not that I don’t want to own a house, it is saving up for that down payment“.  So I asked her, “How much do you think a down payment on a house is?“. “Like 20%“, she responded. 

Her answer is typical of what a lot of people believe, especially if they don’t yet own a home. They think that the only way they can own a place is if they have 20% down. That means, in today’s market, in South Florida, a young couple looking for a starter home would need between $70K to $80K if they are looking a modest single family home in the $350K to $400K range. 

This could not be further from the truth, especially if someone is looking to buy their first home.

So How Much Do You Really Need?

There are a lot of factors that go in to determining how much a person will need for a down payment. But generally, if you have good credit, steady income, and an acceptable debt to income ratio, you could qualify for loan with a down payment as low as 3.5% to 5%. 

That means that if you are looking to buy a house in the $350K range you will need a down payment between $12,250 (3.5%) to $17,500 (5%). I you are looking to buy in the $400K range you will need a down payment between $14,000 (3.5%) to $20,000 (5%). 

Find Out If You Qualify

Finding out if you qualify or learning about what you need to qualify for a mortgage is quick and easy. Click on the button below to take your first step toward homeownership. 

Don't Forget the Closing Costs!

The down payment amount does not include closing costs, so you have to factor that in as well. The lender may have programs that will allow you to get assistance toward or roll your closing costs into your mortgage payment. You can also ask the Seller if they will contribute some money toward your closing costs. Depending on the market they may or may not be receptive to your request, but unless you ask, you never know what they will say. 

Preparing to Fulfill Your American Dream

Now that you know that a down payment is not 20%, check out these additional resources to help you prepare for fulfilling your American Dream of homeownership.

12 Creative Ways to Save for a Down Payment on a Home

6 Tips To Help You Get Pre-Approved for a Mortgage

8 Things Not To Do When Buying A House

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* is an independent publication, not affiliated with the City of Oakland Park.

Desiree Avila


Désirée Ávila has called Oakland Park her home for over 33 years. In addition to publishing, Désirée has been featured in print publications, locally and abroad. Désirée was an award winning teacher for 10 years and has a doctoral level education in Educational Technology. She is currently a licensed Florida Realtor® and is committed to a high-level of professionalism.

Désirée consistently professionally develops herself and has earned several different professional designations and certifications in real estate including the PSA, e-Pro, AHWD, SRS, ABR, and SFR. She was also awarded the C2EX, Commitment to Excellence award by the National Association for Realtors (NAR). This award is given to Realtors® that distinguish themselves for their commitment to excellence in the real estate industry.

She is esteemed by her real estate colleagues and has consistently received 5 star reviews from her clients. Her philosophy about real estate is that being a Realtor® is a way of teaching and helping people, and in the process a real estate transaction may occur, that is to say her foremost priority is and has always been about helping others.

She is dedicated to her hometown of Oakland Park and works consistently on building and fostering a strong community. She is passionate about photography and loves to read books about history ; the more detail the better! In addition to English, Désirée is fluent in Portuguese, Spanish, French and Italian.

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