If your credit is average (vs. excellent) you may still be able to get a loan, but may find your purchasing power reduced due to higher interest rate.
If you have flaws in your credit, a short job history, or other factors which limit your credit worthiness, you may find that a larger down payment is necessary to obtain financing.
20% is great if you can afford it. but otherwise, 10% is a very good number. There is no standard number. There are a lot of people with good credit and 5% making deals becasue they know the marke is at a low and it is time to buy.
The 25% down better rate answer I disagree with. lenders are still willing to work with people and you WILL get a good rate with 10% down. Just go to a legitimate bank.
Mortgage Brokers are full of good stories, but I have seen few with good endings.
May I suggest you think of it more like a funding formula rather than a "standard" downpayment? For example:
3% down, 97% financing (PMI insurance required)
5% down, 95% financing (PMI insurance required)
10% down, 90% financing (PMI insurance required)
20% down, 80% financing (PMI may or may not be required per lending stipulation)
25% down, 75% financing (No PMI insurance required, better interest rate)
The more down payment, the better the financing package. I usually do a presentation for my clients explaining afordability by three different rules:
1. The Income Rule (e.g. borrorer's monthly expenses cannot exceed income specified by the lender).
2. The Debt Rule (e.g. total housing expenses, exisiting debt plus new mortgage debt/ratio).
3. The Cash Rule (e.g. must have cash sufficient to meet down payment and settlement costs, moving costs and survive to eat well, fix the car, pay for unexpected life expenses, maybe decorate the place, etc).
A good loan for a borrower is one that you're not just willing to pay, but it's one you have the ability to pay and not lose your shirt or investment if something unexpected crops up. There is really no standard anything, it's more like each individual will find a financing package that meets their criteria and needs while conforming to the cash on hand. Just because you can put down 25% doesn't mean you have to.
Please contact me if you would like more information.