Down payment
A down payment is part of the purchase price paid in advance in cash, reducing the amount of money you plan to borrow to purchase your home. Many lenders require a down payment of 20% of the price of the home to avoid having to purchase private mortgage insurance. The amount of the down payment may also affect the interest rate you pay. Lenders offer a variety of programs that make it possible to buy a home with a down payment of less than 20%.