For many Utah buyers, the downpayment is the single biggest hurdle to homeownership. You might be wondering how much you need to save, what programs are available, and whether there are ways to buy with less money upfront. The truth is that downpayment options are more flexible than most people realize. From FHA to VA to Conventional loans, to statewide and city-specific assistance programs, there are multiple paths to get the keys to your new home.
Understanding downpayment options matters because it can change the type of home you buy, the monthly payment you take on, and how quickly you can enter the market. This article walks you through the most common strategies in Utah, while highlighting real assistance programs that may help you sooner than you think.
FHA Downpayments
FHA loans are one of the most popular ways for Utah buyers to get into a home without needing a large amount of cash upfront. With FHA, you only need to put down 3.5 percent. For a $400,000 home in Salt Lake County, that means just $14,000 compared to the $80,000 a 20 percent downpayment would require.
FHA loans are especially helpful for first-time buyers or those with average credit scores. They do come with mortgage insurance, which adds to your monthly payment, but the low barrier to entry makes them an attractive option. For more detail on how FHA compares with other loan types, see my article on FHA vs VA vs Conventional Loans in Utah.
VA Downpayments
If you are a veteran, active-duty service member, or part of a military family, the VA loan is one of the most powerful options available. VA loans require no downpayment at all. That means you can purchase a home in Utah without needing to save tens of thousands of dollars.
Beyond the zero percent downpayment, VA loans do not require private mortgage insurance, which keeps monthly costs lower. This benefit often allows veterans to buy more home for their money while maintaining affordability.
Conventional Loan Downpayments
Conventional loans are the most common type of financing, and their downpayment requirements can vary. The minimum is usually 3 percent, but many Utah buyers choose to put down 10 to 20 percent to avoid private mortgage insurance.
Putting more money down gives you immediate equity and lowers your monthly payment. For financially strong buyers, a larger downpayment can also make your offer more attractive in competitive Utah markets like Draper, Herriman, and Holladay.
For a broader look at how loan types tie into the buying process, check out my Buyer’s Guide.
Utah-Specific Downpayment Assistance Programs
Utah has some of the best assistance programs in the country, many of them designed to get first-time buyers into homes with far less cash upfront. These programs are offered statewide through the Utah Housing Corporation and at the local level by cities and counties.
Statewide Programs:
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Utah Housing DPA Second Loan: Offers up to 6% of the first mortgage as a second loan, helping buyers cover downpayment or closing costs. Payments are added to the primary mortgage, making it easier to buy with little personal cash.
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First-Time Homebuyers Assistance Program (SB 240): Provides up to $20,000 as a 0% interest loan, typically for new construction homes. No monthly payments are required, and the loan is repaid when you sell or refinance.
Local Programs:
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Own in Ogden offers $10,000 to $20,000 in assistance depending on your profession.
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Provo’s Home Purchase Plus provides $15,000 to over $50,000 as a deferred loan, with partial forgiveness after several years.
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Salt Lake City and County programs provide $20,000 to $39,000 as forgivable loans for first-time buyers.
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Davis County offers loans up to $50,000 with low interest.
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Tooele County and Box Elder County also provide smaller grants or loans for qualified buyers.
These programs often require income limits, homebuyer education, and a personal contribution of $500 to $1,000. They are typically first-come, first-served, so applying early is important.
Using Gifts and Other Sources
Another option is to use gift funds. FHA and Conventional loans both allow downpayments to be covered by gifts from family or other approved sources. This can be a huge help for Utah buyers whose relatives are willing to contribute to their future home.
Some buyers also use funds from retirement accounts or other investments. These should always be considered carefully with the guidance of a financial advisor, since tapping into retirement money has long-term implications.
Why Downpayments Matter
Your downpayment is more than just a financial requirement. It is your first investment in your home. A larger downpayment builds instant equity and reduces risk, while a smaller downpayment can help you buy sooner and preserve your savings. Both approaches have value depending on your goals.
If you want to understand how your downpayment interacts with other costs like appraisals, inspections, and fees, my article on Utah Closing Costs Explained is a great companion read. Together, these two articles give you a full picture of the financial side of buying a home.
Final Thought
Buying a home in Utah does not have to feel out of reach. Whether you are taking advantage of FHA’s low downpayment, using a VA loan with zero down, going Conventional with 20 percent, or applying for assistance through Utah Housing and local city programs, there is an option for every type of buyer. The key is education and planning.
I love helping Utah buyers explore their downpayment strategies and connecting them with lenders who can show them what is possible. When you understand your options, the process becomes less stressful and more exciting. Homeownership is closer than you think, and your downpayment plan can get you there.
