Is 5% Down Enough to Buy a House?

What 5% Down Actually Costs on a Real Home

On a $300,000 home, 5% down is $15,000. But the down payment is only part of the cash you need at the table. Closing costs run 2-5% of the purchase price, so plan on roughly $20,700 to $29,250 total for that same $300,000 home. Most conventional lenders also want to see 2 to 6 months of mortgage payments sitting in reserve at closing, and they prefer a debt-to-income ratio of 43% or lower. Putting down less than 20% means private mortgage insurance (PMI), which costs 0.46% to 1.50% of the loan amount per year - about $120 to $240 a month on a $285,000 loan. That is the real trade: you get in the door years sooner, and you pay a monthly fee for the smaller cushion. For context, the average first-time buyer puts down 6-7%, so 5% puts you right in the mainstream.

The $4,500 Mistake: Picking FHA Just to Shrink the Down Payment

Here is the trap the numbers in Opendoor's own buyer guide expose. On a $300,000 home, FHA asks 3.5% down ($10,500) and conventional asks 5% ($15,000). Plenty of buyers take the FHA route to keep that $4,500 in their pocket. The catch: FHA's mortgage insurance premium usually lasts the life of the loan. Conventional PMI ends. Federal law removes it automatically at 78% loan-to-value, you can request removal at 80% with a clean payment history, and if your home appreciates, a re-appraisal can get you to 80% in year 2 to 4 - instead of the year 8 to 9 it takes through amortization alone. Saving $4,500 today can cost tens of thousands in premiums you can never cancel. If your credit score clears 620, run the conventional math before you sign anything.

What a 5%-Down Buyer Means When You Are the One Selling

If you are selling a home in Florida, the buyer at your table probably looks like the buyer in this article: 5% or less down, financed, carrying PMI. That is not a red flag. A financed buyer with verified approval, documented reserves, and a debt-to-income ratio under 43% closes just as surely as anyone else. The real risk is not the size of the down payment - it is taking your home off the market for a buyer nobody actually vetted. That is the exact problem Cash Flow Deals is built around. CFD is a Florida real estate investor that connects homeowners directly to vetted FHA, conventional, VA, and DSCR buyers through a novation agreement, so the buyer's financing gets checked before your time gets committed. Listing-side details run through Silver Door Realty, a licensed Florida brokerage. If you are weighing a sale, start at our Florida hub: /florida/sell-my-house-fast.

Cash Flow Deals is a Florida real estate investor that locks in a net price for a seller's house before repairs are scoped, using a novation-based, flat-fee process arranged through its licensed FL brokerage partner, Silver Door Realty — not a traditional listing, and not a brokerage itself.

Here is what working with Cash Flow Deals looks like for a seller weighing this exact trade-off:

1. Cash Flow Deals reviews your property and the buyer's financing picture up front, so you are never left waiting on a 5%-down buyer's PMI and underwriting approval to find out if the sale is real.

2. Your net price comes back within 24 hours, verified before your home is ever put under contract with an unproven buyer.

3. Closing happens in as little as 10 business days, on a schedule set by underwriting completed up front rather than a buyer's down-payment and PMI approval timeline.