When considering how much to put as a down payment on a house, you need to consider several factors. Most mortgage companies prefer 20% down, but there are other options and many points to contemplate. First, how much do you have in savings? Not only will you need money for a down payment, but closing costs can run upwards of $5,000 or more and do not got towards the down payment.
Also, what are the current interest rates? The general rule is, the lower the rate and the higher the down payment, the more house you can afford. Furthermore, current interest rates need to be taken into account. Do you want a fixed rate mortgage or an adjustable rate mortgage? Currently in 2014, mortgage rates are historically very low, so a fixed rate mortgage is probably the best option. Having an adjustable rate mortgage could backfire on you if interest rates rise considerably.
Another factor to think about is whether you want a 15 year or 30 year mortgage. If you choose the 15 year option, depending on current interest rates, your monthly payment will be higher but you will be able to pay off your house in half the time. This is something to think about if you have young children and plan on sending them to college. If the fifteen year mortgage is not an option, consider making an extra monthly payment per annum, spread out over the year. For example, if you have a $1200 monthly mortgage payment, add $100 to the payment every month and you will shave a few years off of your mortgage.
Additionally, how much can you afford as a monthly payment? Looking at your cash flow, and considering other monthly expenses, like cars, taxes, insurance, heating, and electricity - how much can you afford? It is always wise to make sure that you have a "cushion", i.e. money in your savings account for life's little emergencies, whether it's a broken water heater or upgrading your furnace. It's a good idea to have at least $10,000 in reserve. It seems like a lot to think about, but if you plan carefully right now, you will enjoy the benefits of home ownership well into the future.