Your Down Payment

Lots of folks who are looking to purchase a new home qualify for various loan programs, but they don't have a large sum of cash to put up the standard down payment. Do you want to buy a new house, but don't know how to get together a down payment?

Reduce expenses and save. Be on the look-out for ways you can reduce your monthly expenditures to put away money for a down payment. You might also decide to enroll in an automatic savings plan to have a percentage of your pay automatically deposited into a savings account. You might look into some big expenses in your spending history that you can live without, or trim, at least temporarily. For example, you may move into less expensive housing, or stay local for your family vacation.

Sell items you do not need and find a part-time job. Try to find a second job. This can be rough, but the temporary trial can help you get your down payment. You can also seriously consider the possessions you really need and the items you can put up for sale. A closetful of small items might add up to a fair amount at a garage or tag sale. You might also look into what your investments could sell for.

Tap into retirement funds. Research the details for your particular plan. It is possible to pull out money from a 401(k) plan for you down payment or withdraw from an Individual Retirement Account. Be sure to learn about the tax consequences, your obligation for repayment, and penalties for withdrawing early.

Ask for help from members of your family. Many buyers are sometimes lucky enough to receive help with their down payment help from giving parents and other family members who are able to help them get into their first home. Your family members may be willing to help you reach the goal of buying your own home.

Learn about housing finance agencies. These types of agencies provide provisional mortgage loans for low and moderate-income buyers, buyers interested in remodeling a home within a particular area, and other groups as defined by each agency. With the help of this type of agency, you can get an interest rate that is below market, down payment help and other advantages. These kinds of agencies may help you with a lower rate of interest, help with your down payment, and provide other benefits. The main mission of not-for-profit housing finance agencies is build up the purchase of homes in particular parts of the city.

Find out about low-down and no-down mortgages.

  • FHA mortgages

    The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in helping low and moderate-income buyers qualify for mortgage loans. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids homebuyers in qualifying for home financing. FHA offers mortgage insurance to the private lenders, enabling buyers who may not be eligible for a typical loan, to get a mortgage. Down payment requirements for FHA loans are smaller than those of conventional mortgage loans, even though these mortgages hold current interest rates. Closing costs may be included in the mortgage, while the down payment can be as low as 3 percent of the purchase price.

  • VA loans

    Guaranteed by the Department of Veterans Affairs, a VA loan qualifies veterens and service people. This specialized loan does not require a down payment, has mimimal closing costs, and offers a competitive rate of interest. Even though the VA does not provide the mortgages, it does issue a certificate of eligibility to qualify for a VA mortgage.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that closes at the same time as the first. Often the first mortgage is for 80% of the cost of the home and the "piggyback" funds 10%. The borrower pays the remaining 10%, instead of putting the typical 20% down payment.

  • Carry-Back loans

    In the option of a seller "carrying back a second mortgage," the you borrow part of the seller's home equity.. The buyer finances the highest percentage of the purchase price through a traditional mortgage program and borrows the remaining funds from the seller. Typically you'll pay a somewhat higher rate on the loan from the seller.

No matter your strategy of putting together your down payment funds, the thrill of reaching the goal of owning your own home will be just as sweet!

Need to talk about your down payment? Call us: (888) 299-4585.

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