What Is the Minimum Down Payment in California?
| Loan Type | Minimum Down | On a $900,000 Home | Notes |
|---|---|---|---|
| VA | 0% | $0 | Eligible service members and veterans |
| USDA | 0% | $0 | Designated rural areas only |
| Conventional 97 | 3% | $27,000 | PMI required |
| FHA | 3.5% | $31,500 | Mortgage insurance usually for the life of the loan |
| Conventional | 5% - 19% | $45,000 - $171,000 | PMI until ~20% equity |
| Conventional | 20% | $180,000 | No PMI |
| Jumbo | 10% - 20%+ | $90,000+ | Above your county's conforming limit |
The 20% rule is a myth, not a requirement. The national average down payment is about 13%. First-time buyers average roughly 8%. Twenty percent is simply the threshold where private mortgage insurance disappears — it has never been a condition of buying.
What Does Each Down Payment Level Actually Cost Monthly?
On a $900,000 California home at 6.5% on a 30-year fixed, principal and interest plus PMI:
| Down Payment | Cash Required | P&I | PMI | Monthly Total |
|---|---|---|---|---|
| 3% | $27,000 | $5,518 | $618 | $6,136 |
| 5% | $45,000 | $5,404 | $534 | $5,939 |
| 10% | $90,000 | $5,120 | $371 | $5,491 |
| 15% | $135,000 | $4,835 | $255 | $5,090 |
| 20% | $180,000 | $4,551 | $0 | $4,551 |
Excludes property tax and insurance, which are identical across all rows. The genuine question is the one buyers rarely frame explicitly: going from 10% to 20% costs $90,000 in cash to save $940 a month. That is roughly an 8-year payback before considering what that $90,000 could earn elsewhere — or whether waiting years to save it means buying at a higher price.
Working out which level makes sense? Roman will run your cash-to-close at several down payment scenarios, including the credit that offsets closing costs.
Get My Free Savings EstimateWhy Is California's Average Down Payment 22%?
California averages about 22% — roughly $173,800 — against a national average near 13%. The explanation is structural, not behavioral.
Loans above your county's conforming limit become jumbo loans, which typically require larger reserves, stricter credit, and often carry a higher rate. California prices routinely cross that line, so buyers put more down specifically to stay under it.
| County | 2026 Conforming Limit | 2026 FHA Limit |
|---|---|---|
| Los Angeles | $1,249,125 | $1,249,125 |
| Orange | $1,249,125 | $1,249,125 |
| Ventura | $1,035,000 | $1,035,000 |
| San Bernardino | $832,750 | $690,000 |
The 2026 baseline rose 3.26% to $832,750, with the high-cost ceiling at $1,249,125 — giving Los Angeles and Orange County buyers nearly $40,000 more borrowing room at conforming terms than in 2025.
A San Bernardino County detail worth catching early. Its FHA limit is $690,000 while its conforming limit is $832,750 — they are not the same number. A buyer purchasing above $690,000 there cannot use FHA financing, even though a conventional conforming loan remains available. If you are planning on 3.5% down in Fontana, Redlands, or Chino Hills, check the price against that limit before you start touring.
How Does PMI Work, and When Does It Go Away?
Private mortgage insurance protects the lender, not you, and it is the main cost of a smaller down payment. How you get rid of it depends entirely on your loan type — and the difference is larger than most buyers realize.
Conventional loans: PMI is removable
Under the Homeowners Protection Act, you can request cancellation once you reach roughly 20% equity based on the original purchase price, and it terminates automatically at about 22%. In an appreciating market you can sometimes accelerate this with a new appraisal, though lenders set their own seasoning requirements.
FHA loans: mortgage insurance usually is not
If you put less than 10% down on an FHA loan, mortgage insurance generally lasts the life of the loan. The common exit is refinancing into a conventional loan once you have sufficient equity — which works well if rates cooperate and less well if they have risen since you bought.
That distinction matters more than the 1% difference in minimum down payment. FHA at 3.5% and conventional at 3% look nearly identical up front; over ten years they are not.
Lender-paid PMI: a real option with a real catch
Some lenders offer to absorb PMI in exchange for a higher interest rate. There is no separate PMI line on your statement, but the higher rate is permanent — it does not disappear at 20% equity the way borrower-paid PMI does. Run both quotes over your realistic holding period before choosing.
Should You Put More Down or Keep the Cash?
There is no universal answer, but there are conditions where each side clearly wins.
| Situation | Lean toward | Why |
|---|---|---|
| Just above your county's conforming limit | More down | Getting under it changes rate, reserves, and underwriting |
| Close to 20% | More down | Eliminating PMI is a guaranteed return |
| Thin reserves after closing | Less down | Lenders require documented reserves; running dry is a real risk |
| Buying in a rising market | Less down | Waiting years to save 20% can cost more than PMI |
| Planning renovations | Less down | Cash on hand beats equity you cannot access easily |
| Self-employed or variable income | Less down | Liquidity matters more when income is uneven |
The conforming-limit row is the one most specific to California. In Ventura County the line sits at $1,035,000 — so a buyer at $1,150,000 who can put down enough to land under it may get materially better terms than one who cannot. That is worth modeling with your lender rather than guessing.
One thing a closing cost credit does not do. It cannot fund your down payment. Most lenders exclude commission rebates and seller credits from your minimum required investment. It offsets closing costs instead — roughly $15,250 on a $900,000 purchase at 2.5% offered — which frees up cash you would otherwise spend, but the down payment itself has to come from documented funds of your own. More on how the credit works →
What California Rules Affect What You Pay?
California layers requirements and costs on top of commission that vary sharply by county and city. These matter more than most buyers and sellers expect.
California AB 2992 codified the written agreement requirement
Effective January 1, 2025, California law requires buyers to sign a written representation agreement with their agent before touring properties, specifying how that agent is compensated. It puts into state statute what the August 2024 NAR settlement established nationally — and it is the mechanism that makes a stated flat fee enforceable rather than aspirational.
Transfer taxes vary enormously by city
Every California county charges a documentary transfer tax of $1.10 per $1,000 of value. Cities may add their own, and some add a great deal — the City of Los Angeles imposes an additional tax on high-value sales that dwarfs the county rate. By contrast, no city in Ventura County or San Bernardino County adds a city-level transfer tax at all.
County breakdowns: Los Angeles · Ventura County · San Bernardino County
Disclosure obligations are among the strictest in the country
California requires a Transfer Disclosure Statement, a Natural Hazard Disclosure covering flood, fire, earthquake and seismic zones, and disclosure of known material facts. In wildfire-designated areas — much of Ventura County and the San Bernardino mountain communities — additional documentation applies. Errors here create liability that outlives the closing.
No commission rate is set by law, and never has been
The California Department of Real Estate does not set rates and no MLS may require a minimum. What changed in 2024 is that compensation must now be disclosed and agreed in advance rather than assumed. Full NAR settlement breakdown →
Escrow practice differs from most states
California uses escrow companies rather than attorneys for residential closings. Escrow fees typically run 1% to 2% of price and are commonly split by local custom — but custom is not law, and the split is negotiable.
Where Does Your Down Payment Go Furthest?
Conforming and FHA limits differ by county, which changes what loan types are even available to you. Roman represents buyers in all four Southern California counties at the same flat fee.
Related reading: Total Cash Needed · How Much Can I Afford? · Mortgage Basics · Flat Fee Buyer's Guide
How a Flat Fee Agent Changes These Numbers
Roman Doktorovich is a flat fee realtor serving Los Angeles, Orange, Ventura and San Bernardino County — $7,250 for transactions under $1.5M and $9,250 at or above, for buyers and sellers alike.
That structure is different from a discount realtor or low commission realtor, who still charges a percentage — just a smaller one. A percentage still grows with the price of the house. A flat fee does not.
- Buying: when a seller offers a buyer's agent commission above the flat fee, the difference returns to you as a commission rebate credited at closing — roughly $15,250 on a $900,000 purchase at 2.5% offered.
- Selling: you pay the flat fee instead of a percentage listing commission. On a $1,000,000 sale, that is $7,250 rather than roughly $27,000 at 2.7%.
Full representation either way — not a limited-service flat fee MLS product. See full pricing → · Compare against traditional commission →