It will depend on many factors. As some have stated, the options can be as little as 0 if you buy in an area approved by a USDA loan and you qualify for their program in regards to income, credit etc. VA is another 0 down option if you are a veteran. If you buy a FannieMae HomePath repossession they offer 3% down loans with up to 3% back for buyer's closing costs. They also waive the appraisal and do not charge for mortgage insurance. FHA requires 3.5% down and is the most flexible and common plan. FHA and conventional loans with less than 20% down will all require mortgage insurance which is an added monthly expense.
If you can save up 20% or more conventional financing will save you the cost of mortgage insurance.
Now, which of these options is best for you I would suggest you talk to some local professionals a Realtor and a lender and trusted family members who have been good with their money.
I'd love to put you in touch with a lender in the area that offers these options
Congratulations on your decision to buy a home! Yes, your first step is to speak with a loan officer who will review your credit with you and help you get the best rate and terms. Your loan officer will discuss with you your comfort level with the payment and together you and the loan officer will decide what price range you should be shopping in.
Regarding your down payment, yes, 3.5% is usually the minimum with the most popular first time home buyer program. In my area, we also have wonderful down payment assistance programs that will help you even get in for less than 3.5% of the purchase price.
Make sure your loan officer is in or near the area you want to buy in. A loan officer in LA is not going to be familiar with down payment assistance programs in Riverside for example.
Finally, when you are ready to shop, get an agent who specializes in first time home buyers. You have different needs than someone who has bought 10 other homes. Also, make sure your agent is in or near the area you want to buy in. There will be many trips out to the house for inspections, appraisals, you want your agent to be accessible.
Hope that helps, and good luck in your search.
If you're not a Veteran (no down), the best out there is FHA; which is 3 1/2% down.
If the house is $500,000 that is $17,500.
Then you will have Closing Cost, which will vary, but figure 5% or $25,000.
Then you will want/need 3 months income in a Saving account.
And you want to have some money for repairs and update to the house.
I don't want to discourage you, but this is realistic.
In the best senario;
The closer you get to Dec. the less you will pay for pre-paid taxes
You could get the Sellers to pick up all or part of your Closing Costs.
And you could find the perfect house that needs no up-dating.
Good luck and may God bless
However, you'll really need some money on top of that. There are closing costs, too . . . though in many instances you can ask the seller to pay some of those.
You should check with a lender to find out how much you qualify for. It wouldn't make sense, for instance, to aim for a downpayment on a $300,000 home if all you'll qualify for is $250,000. Your Realtor can also help estimate the costs you'll run into.
Hope that helps.