If you’ve been waiting to buy your first home until you have “enough” saved up, you’re not alone. Most people we talk to have a number in their head — often 20% of the purchase price — and they’re quietly convinced they’re nowhere close.

Here’s the truth: for most first-time buyers in 2026, that number is wrong. Not a little wrong. A lot wrong.

Let’s break down what it actually costs to get into a home today, where the 20% myth came from, and why programs built for real buyers — not the textbook version of a buyer — have made the math a lot friendlier than you think.

If you’ve been waiting to buy your first home until you have “enough” saved up, you’re not alone. Most people we talk to have a number in their head — often 20% of the purchase price — and they’re quietly convinced they’re nowhere close.

Here’s the truth: for most first-time buyers in 2026, that number is wrong. Not a little wrong. A lot wrong.

Let’s break down what it actually costs to get into a home today, where the 20% myth came from, and why programs built for real buyers — not the textbook version of a buyer — have made the math a lot friendlier than you think.

Where the 20% Down Myth Came From

The 20% figure isn’t pulled out of thin air. It used to be the threshold for avoiding private mortgage insurance (PMI) on a conventional loan, which is a fee lenders charge when your down payment is small. That piece is still true.

What’s changed is how many loan programs now exist specifically to help people buy with far less down — including some that require nothing at all. Twenty percent was never a rule; it was a target that made the loan cheaper. It still does, but it’s not a requirement, and for most first-time buyers, waiting to save that much can cost you more in rising home prices than you’d ever save in interest.

What First-Time Buyers Actually Put Down

According to the National Association of Realtors, the median down payment for a first-time buyer has hovered between 6% and 8% for years. Not 20%. And that’s the median — meaning half of first-time buyers put down even less.

Here’s the range you’ll see across common loan types:

• Conventional loan: as little as 3% down

• FHA loan: 3.5% down with credit scores as low as 580

• VA loan: 0% down for eligible veterans and service members

• USDA loan: 0% down in eligible rural and suburban areas

• Down Payment Assistance (DPA) programs: can bring your out-of-pocket costs to $0 even on a conventional or FHA loan

In other words: the loan product you pick changes everything. If you’ve been saving toward a 20% down payment, you may already have more than enough for two or three different paths into a home.

The Full Cost of Buying a Home (It’s Not Just the Down Payment)

When people talk about the cash you need to buy a house, they usually mean the down payment. But there are a few other line items that catch new buyers off guard. Here’s the full picture on a $400,000 home:

• Down payment: $0 to $80,000 depending on loan type

• Closing costs: typically 2% to 5% of the loan amount ($8,000–$20,000)

• Earnest money deposit: usually 1% of the purchase price, applied toward your down payment or closing costs

• Home inspection: $400–$600, paid at the time of inspection

• Appraisal: $500–$800, typically paid upfront or rolled into closing

• Reserves: many loan programs want to see 1–3 months of mortgage payments in savings after closing

That list looks intimidating, but almost every item on it can be negotiated, rolled into the loan, or covered by a seller credit or assistance program. Knowing what the costs are is the first step. Knowing which ones actually have to come out of your pocket is the real answer.

How Down Payment Assistance Changes the Math

Down Payment Assistance (DPA) programs are exactly what they sound like: money that helps cover your down payment and, in many cases, your closing costs. Some are grants. Some are forgivable loans. Some are second mortgages with favorable terms.

The key thing to know is that DPA isn’t a special-case program for one narrow group of buyers. There are thousands of DPA programs across the country — state, county, city, employer, and lender-sponsored — and most first-time buyers qualify for at least one of them.

At Lowtility, we built our program around a specific piece of DPA called Grid to Green, which covers up to 5% of your purchase price toward your down payment and closing costs. On that $400,000 home, that’s $20,000 you don’t have to bring to the table.

The Zero-Down Path with Lowtility

Lowtility bundles three things into a single loan: your mortgage, down payment assistance, and energy upgrades for your home (like solar and battery backup). The result is a path into homeownership that looks different from what most buyers are used to:

• $0 down payment required for most qualified buyers

• $0 cash to close — closing costs can be covered too

• Credit scores as low as 580

• No income limits and no geographic restrictions

• Energy savings that often offset or eliminate your monthly utility bill

For a first-time buyer who’s been saving for years, that changes the question from “How much more do I need?” to “When do I want to move in?”

The Bottom Line

The real answer to “How much money do I need to buy a home?” is: it depends on the loan you use. If you’re going conventional with no assistance, plan on 5–10% of the purchase price in cash. If you’re using FHA, 3.5% plus a few thousand in closing costs. If you’re using a program like Lowtility, the answer might genuinely be zero.

The worst thing you can do is keep waiting to save a number that was never actually required. Home prices go up. Rent goes up. And every month you’re paying someone else’s mortgage is a month your own equity isn’t growing.

If you’re curious what you’d actually need to buy a home this year, the fastest way to get a real answer is to run your numbers with a loan officer who knows which programs you qualify for. That conversation is free, and you might walk away realizing you’re a lot closer than you thought.

Ready to see what you qualify for?

Take our 2-minute buying power quiz at Lowtility.com and we’ll show you exactly what programs fit your situation — including whether zero-down is on the table for you.