Down Payment Guide for Delray Beach Buyers: What You Actually Need

Minimums are lower than you think

Conventional loans allow down payments in the low single digits for qualified buyers, FHA requires 3.5% down, and VA offers zero down for eligible borrowers. The oft-quoted 20% is a choice, not a requirement — it removes mortgage insurance on a conventional loan and shrinks the payment, but plenty of buyers close with less and manage the trade-off well.

How mortgage insurance works — and ends

With less than 20% down on a conventional loan, you'll pay private mortgage insurance, or PMI. It isn't forever: you can request removal once your loan balance reaches 80% of the home's original value, and lenders must automatically end it when the balance reaches 78%. Rising values can also create removal options on some loans through a new appraisal — ask your servicer what they allow.

FHA loans handle mortgage insurance differently, and it can last much longer, which is a real factor when comparing an FHA loan to a conventional one. A good lender will show you both scenarios side by side.

Where the money comes from

Delray buyers fund down payments from savings, the sale of a previous home, retirement account loans, and family gifts. Buyers relocating from the Northeast often arrive with proceeds from a home sale, while first-time buyers targeting condos near Pineapple Grove or townhomes west of downtown more often combine savings with gift funds. Gifts are permitted on most loan types with simple documentation — a signed gift letter and a paper trail. Down payment assistance programs also exist for eligible first-time buyers within income limits; ask your lender, because funds are often limited and awarded first-come, first-served.

Balance payment and reserves

The healthiest down payment is one that keeps your monthly payment comfortable and leaves cash after closing. Coastal homes carry insurance, flood coverage in some zones, and association dues — leave room for the full monthly picture, not just the loan.

Let's talk it through

Share your price range and savings picture and I'll point you to lenders who will map your options without a hard sell.