How Much Down Payment Do You Actually Need to Buy a Home in the Upstate?
The Pathway Mortgage team sits down with veteran Upstate broker Craig Williams to unpack the 20% myth, the honest story on down payment assistance, and how to figure out the right number for your situation — not a rule of thumb from 1985.
PATHWAY MORTGAGE MARKETING TEAM · JULY 2026
Ask ten Upstate homebuyers how much they need to put down on a house, and eight of them will say 20 percent. Ask a mortgage broker who has been doing this in Greenville, Travelers Rest, and Spartanburg for years, and you will get a very different answer.
We recently sat down with Craig Williams — one of the brokers on the Pathway Mortgage team (NMLS #1745932) — to walk through what buyers in the Upstate are actually putting down in 2026, the honest story on down payment assistance programs, and how to think about the down payment decision in a way that fits your real financial life.
What emerged from that conversation was less a set of rules and more a framework. And the framework starts with recognizing that the number stuck in most buyers' heads has almost nothing to do with what mortgages actually require today.
The Upstate Market Backdrop
A quick look at where the Upstate housing market stands as we head into the back half of 2026, because context matters for every down payment decision:
Rates. The average 30-year fixed mortgage rate in South Carolina is running roughly 6.45–6.50 percent, down about half a percentage point from a year ago.
Prices. Median sale prices vary sharply across our three primary markets: Spartanburg around $265K, Greenville around $370K at the county level, and Travelers Rest closer to $529K. The right down payment on a $265K starter home is a very different conversation than one on a $530K move-up.
Inventory. Statewide active listings are up 7.4 percent year over year, and days on market have stretched into the 50–70 day range across most of the Upstate. That gives buyers negotiating room — and time to make thoughtful decisions instead of panicked ones.
For a lot of would-be buyers, though, the biggest obstacle right now is not the market. It is a number stuck in their head.
The 20 Percent Down Payment Myth Won't Die
When we asked Craig what misconception he pushes back on most often, he did not hesitate.
The biggest myth is always going to be that you need to have 20 percent down before you can buy a home. Someone might be saying, ‘I really need to save up 15 percent, or 20, or even 10 percent down.’ That myth comes from historically good advice — you need to put some money into the transaction, you need to be paying your mortgage down quickly, so start with your mortgage at a lower amount. Those are important things. But for homebuyers, they need to look at all their options.
— Craig Williams, Pathway Mortgage
The national data backs him up. According to the National Association of Realtors, the median down payment for first-time buyers in the United States is around 9–10 percent — not 20. And for many buyers, it is meaningfully lower still.
Craig's read on where the myth actually comes from is telling. Most people repeating it are not really thinking about down payment percentages at all. They are thinking about monthly payment comfort — and using the 20 percent rule as a proxy.
Really what someone might be saying is: for me, I need to have a certain monthly payment I can handle, and that I should handle if I'm going to keep paying all the other bills, set aside money for retirement, and have enough of a cushion if there are emergencies. So if you have enough cash for all those other purposes, then what's the monthly payment you're comfortable with? Go to your mortgage lender and say, ‘Can you help me see what it would look like at $1,500 a month versus $1,800 versus $2,000?’ Then you can look at the price point and the down payment together.
— Craig Williams, Pathway Mortgage
That reframe — from “how much do I need to save?” to “what monthly payment fits my life?” — changes the whole conversation.
The Hidden Cost of Saving Toward a Number You Don't Actually Need
Craig also raised something that buyers rarely calculate when they set a 20 percent savings goal: the time cost.
If you're really waiting that long, how long are you going to have to wait before you can buy? Home prices historically go up. We just came through four or five years of correcting where home prices went up so much. Prices are up now, and they will continue. So how long are you going to wait on the sidelines before you have the 20 percent down? That could take a while. Meanwhile, you can be slowly building equity right now — if you make a good decision. That's the key of it. Making a good decision.
— Craig Williams, Pathway Mortgage
The math on this is worth spelling out. If Upstate home prices appreciate at even a modest 3 percent per year, a $300,000 home today costs roughly $309,000 next year and closer to $328,000 in three years. A buyer waiting three years to save from 5 percent down up to 20 percent down on that same home would need to save an additional $45,000 — while the home they are trying to buy climbs $28,000 further out of reach in the same window. Add three years of rent to the equation, and the “wait to save 20 percent” plan often costs more than it saves.
What Real Down Payment Minimums Look Like in 2026
Depending on the loan product, the actual floor a qualified buyer needs to put down can be dramatically lower than 20 percent:
Conventional 97: 3 percent down for qualifying first-time buyers
FHA: 3.5 percent down with a 580+ credit score
VA: 0 percent down for eligible veterans, active-duty service members, and surviving spouses
USDA: 0 percent down in eligible rural areas — which includes significant portions of northern Greenville County, the corridor around Travelers Rest, and outer Spartanburg County
USDA is a loan product Craig comes back to often when we talk about the Upstate specifically.
I talk often about USDA loans because it's a really good option in our area — when you're outside the city limits, when you're a little bit farther into the country, zero-percent down really works well for a lot of people. I recently had somebody who was considering USDA 0 percent down versus conventional or FHA with a small down payment. When you looked at the monthly payment, it was pretty similar. The downside is USDA has a larger fee, but it gets financed into the loan amount. So on a $300,000 house you might be talking about a $3,000 fixed fee, but it gets financed in. That's far better than spending all your cash reserves on the down payment and closing costs.
— Craig Williams, Pathway Mortgage
That last point matters more than most buyers realize. Cash at closing and cash after closing are two very different resources — and Craig's framework treats both as part of the same decision. A buyer who empties their savings account to reach a bigger down payment is a buyer who has no cushion when the HVAC needs replacing three months in.
Down Payment Assistance: The Honest Version
Down payment assistance — or DPA — is one of the most-searched terms in the mortgage world right now. Buyers hear about it from friends, from TikTok, from Google, and they arrive at their first lender meeting convinced that a DPA program is the answer to their down payment question. Sometimes it is. More often, it is not. We asked Craig for his honest take.
Down payment assistance? Yes, we can help with that. It's not our heavy focus. We work with a couple of national investors that offer down payment assistance programs for conventional and FHA buyers, and there's a local-to-South-Carolina option called Community Works that can be a good fit for some borrowers. But not every program is the right move, and not every lender offers the same options. That's why we walk you through what actually makes sense for your situation.
— Craig Williams, Pathway Mortgage
Here is the piece most DPA content skips: assistance programs come with their own trade-offs. Sometimes a higher interest rate on the first mortgage. Sometimes income or occupancy restrictions. Sometimes a lien on the property that stays in place for years. Once buyers actually run the numbers side-by-side against a standard 3 or 3.5 percent down conventional or FHA loan, many of them end up choosing the standard path — because for their situation, it is cleaner, cheaper over the life of the loan, or simply less complicated.
That said, for buyers who genuinely fit, Community Works is worth understanding. It is one of the local down payment assistance programs available in the Upstate, and eligibility falls into two buckets — one based on where you live, and one based on where you work.
Community Works — Location-Based Eligibility
City of Spartanburg residents
Greenville County residents (currently closed; expected to reopen Summer 2026)
Community Works — Employer-Based Eligibility
City of Greenville employees (NEW for 2026 with major funding)
PRISMA Health employees
Spartanburg Regional Healthcare employees
We recently walked through Community Works in a quick visual overview on our Instagram — if you fit any of the categories above, it is worth a look.
The honest bottom line, in Craig's words: not every DPA program is the right move, and not every lender offers the same options. The best first step is a real conversation about your specific situation — before you fall in love with a particular program name. Sometimes DPA is the answer. Often, a standard low-down-payment loan is the cleaner one.
So — How Much Should YOU Actually Put Down?
We asked Craig for his honest opinion. The version he would give a friend, not a marketing headline. If someone is choosing between 3 percent, 10 percent, or 20 percent down, what does he actually tell them?
It always comes down to your financial situation. Whether you're a friend or family, I'm going to be thinking about you like someone I've known for a long time. If I hear your story, I'll get to know you and your goals pretty quickly. I might see two people with the same job and very similar money in the bank, but depending on their kids, depending on their need to buy a home, I may counsel one of them to be a little more aware of their down payment options and put less money down — because they've got other needs.
— Craig Williams, Pathway Mortgage
Boiled down, Craig's framework rests on two anchoring questions:
What monthly payment am I genuinely comfortable with, given every other thing I'm responsible for?
What cash will I have after closing, and what future purposes does that cash need to serve?
On the second question, Craig was emphatic in follow-up notes he shared with us after the interview — and it is a piece of counsel most homebuying content skips entirely.
Consider putting less money down — maybe 3 or 5 percent down if you have a good credit score — because your mortgage may actually be some of the best debt you can leverage. Maybe the home you're buying has updates you want to make. Set aside the money you need in cash for those updates, or come up with a plan to pay for renovations in cash. Or maybe you need to use available cash to pay down credit cards, or more costly auto or installment loans. You make your decisions about the home and the loan based on the monthly payment you're comfortable with AND the cash you'll have when you close — because expenses can come up out of nowhere.
— Craig Williams, Pathway Mortgage
Consider what that actually means at 6.45 percent interest. A mortgage today is often cheaper debt than credit cards (18–24 percent APR) or many auto loans (7–11 percent APR). Putting 3 or 5 percent down instead of 15 or 20 percent means a slightly higher monthly payment and PMI for a period of time — but it also means $30,000 or $40,000 stays available for renovations, high-interest debt payoff, or the emergency reserve every homeowner eventually needs. Using cash to eliminate higher-cost debt first — while keeping the mortgage payment manageable — can be the mathematically stronger play, even when it feels counterintuitive to someone who was told to put “as much down as possible.”
Creative Ways Upstate Buyers Actually Assemble the Down Payment
Even a 3 or 5 percent down payment takes cash. When we asked Craig how his clients actually pull the money together, he walked through the mix of sources he sees most often.
Your standard places are your checking and savings — the money you're saving every month. A quick one for someone who's low on cash is your tax refund. That's when people say, ‘I've got a little extra boost here, can I use that?’ If you're relocating, you might have employer assistance. One of the big ones people forget about is their 401(k) or retirement account. You don't have to WITHDRAW from it — you can just take a LOAN from it. In many cases, the 401(k) allows a loan, and as long as you stay employed there, every paycheck you'll be paying it back automatically, and the interest is pretty low.
— Craig Williams, Pathway Mortgage
Gift funds from family are another commonly overlooked source — and one Craig actively encourages clients to explore.
When people are looking at a home purchase, they're often already talking about it with family. I encourage that, because you may be able to get a small amount of cash — or a sizable amount. Maybe it's $10,000 or $20,000 as a gift from family. That is a huge boost when you're taking on the loan by yourself but they're helping you with the down payment.
— Craig Williams, Pathway Mortgage
For business owners, Craig also mentioned that pulling from an owned business can be part of the strategy — though that scenario requires careful planning with both your lender and your accountant to keep the transaction clean from an underwriting standpoint.
The national data reflects how common a mixed approach really is: 59 percent of first-time buyers pull their down payment from personal savings, 26 percent draw from financial assets like retirement accounts, and 22 percent use gifts or loans from family. Most buyers use more than one source. There is no single “right” way to assemble the down payment.
What If You Already Own a Home?
For move-up buyers using equity from a current home to fund a new down payment, the current market actually offers more flexibility than it has in several years.
This has been a big topic recently because home values have gone up. People want to use that equity to buy their new home. The simple financial answer — but the more complicated one in practice — is to submit offers to buy that are contingent on your current home selling. Your home has to sell first, or maybe close the week before, or literally the same day. You can sell and buy on the same day.
— Craig Williams, Pathway Mortgage
Craig noted that more sellers are accepting contingent offers in mid-2026 than in the last two years. As inventory has loosened statewide, sellers have more incentive to work with qualified buyers even when a home sale is part of the picture.
The trick is: how ready to sell is your home? Are you going to list it at a really competitive price? How quick and determined are you to sell so you can buy the new one? Sellers are going to look at that. If they're looking at your offer to buy and they think ‘this home isn't even on the market yet,’ you need to give them reassurances — like ‘I've already done the work, I can list this next week.’ That's really helpful for them to see, and helpful for you.
— Craig Williams, Pathway Mortgage
For buyers who can qualify without the sale contingency, a HELOC or bridge loan against the current home can free up equity ahead of the new purchase. But Craig had a counterintuitive suggestion here too — one that echoes his broader framework on down payment size.
If you're comfortable with it, be willing to put far less down on your new home, so you can actually afford it — especially if the down payment is tight and you don't have the money in other places. Then when you sell your existing home, let's talk about the ramifications of using that $200,000 or $300,000 to pay down your new mortgage. You can redo your monthly payment without refinancing — it's called a reamortization. Look at that. Make sure you're comfortable with it.
— Craig Williams, Pathway Mortgage
That reamortization move is one of the least-discussed tools in the mortgage world. Once your first home sells, you can apply a large lump sum to the new mortgage principal and have the loan re-amortized — resetting your monthly payment based on the smaller balance, without going through the cost and paperwork of a refinance. It is a way to capture the benefit of “putting a lot down” without having to have all the cash lined up at closing.
The Framework, One More Time
If you take one thing away from this conversation with Craig, let it be this: the right down payment is not a percentage. It is a decision that fits your life.
Two questions, every time:
What monthly payment am I genuinely comfortable with, given everything else I'm responsible for?
What cash do I need to have available after closing — for renovations, for other debts, for the emergencies that always come?
Once you have honest answers to those, the down payment number falls out naturally. Sometimes it is 3 percent. Sometimes it is 5, or 10, or 20. Sometimes it is zero. The percentage is not the point. The fit is.
Ready to Have This Conversation?
If you are thinking about buying in the Upstate — Greenville, Travelers Rest, Spartanburg, or anywhere in South Carolina — the conversation Craig described in this article is exactly the conversation Craig and the Pathway Mortgage team want to have with you. No pressure, no cookie-cutter formulas, no rules of thumb from 1985. Just an honest look at your numbers, your goals, and the loan products and programs that actually fit your life.
Reach Craig directly: call 864-797-4707, email craig@pathwaymortgage.org, or start your application at pathwaymortgage.shapeportal.com/ref/10. Pathway has been a local Upstate team since 1998 — we live here too.
