The Truth About Down Payments in NYC & Long Island: You Don’t Need 20%

by Latisha Dash

If you’re a first-time homebuyer in Queens, Brooklyn, or Long Island, chances are you’ve been told you need 20% down to buy a home. And chances are—that “rule” has been keeping you renting way longer than necessary.

Here’s the truth: you don’t need 20% down to buy a home.

Where Did the 20% Myth Come From?

The 20% number comes from old-school thinking. Yes, putting 20% down eliminates PMI (private mortgage insurance), but in today’s market, waiting years to save that much could actually cost you more than buying with a smaller down payment.

What First-Time Buyers in NYC & Long Island Actually Need

FHA Loan: As little as 3.5% down.
Conventional Loan (First-Time Buyer Programs): As little as 3% down.
VA Loan (Veterans & Active Duty): 0% down.
SONYMA Loans (New York State Program): Low down payment + closing cost assistance.
Local Grants & Assistance Programs: Certain Long Island and NYC community development programs offer thousands toward your purchase if you qualify.

💡 Example: On a $550,000 home in Queens, 20% down is $110,000. At 3.5%, you’d only need $19,250. That’s the difference between waiting years versus buying this year.

Why Waiting Can Cost You

Rising Home Prices: While you’re saving, homes keep appreciating.
Lost Equity: Every year you wait is a year you could have been building wealth through ownership.
Higher Rent: Money going toward rent isn’t building anything for you.
Interest Rate Fluctuations: Even if prices stayed flat, a rate increase can make the same home more expensive monthly.

The Smart Play for Buyers

Instead of stressing over 20%, focus on:
✅ Being financially stable (steady income, good debt-to-income ratio).
✅ Understanding your monthly comfort zone.
✅ Exploring loan programs designed for first-time buyers.

Bottom Line

The 20% rule is a myth that’s stopping too many families in NYC & Long Island from building wealth through homeownership. The real question isn’t “Do you have 20%?”—it’s “Are you ready to take the first step toward owning?”

Because the sooner you buy, the sooner you start building equity, security, and stability for your family’s future.