Your Down Payment

Many buyers qualify for various loan programs, but they can't afford a large down payment. Start here

Cut expenses and save. Scrutinize your budget to find extra money to go toward your down payment. You may also decide to enroll in an automatic savings plan to have a portion of your payroll automatically moved into your savings account. You might look into some big expenses in your spending history that you can give up, or reduce, at least temporarily. Here are a couple of examples: you might decide to move into less expensive housing, or skip a vacation.

Sell things you don't need and find a part-time job. Try to find a second job. This can be rough, but the temporary trial can provide your down payment money. Additionally, you can make a comprehensive inventory of things you can sell. Broken gold jewelry can bring a good price from local jewelers. Maybe you have desirable items you can put up for sale on an online auction, or household goods for a tag or garage sale. You could also explore what your investments could sell for.

Borrow funds from your retirement plan. Explore the specifics for your particular plan. Some homebuyers get down payment money from withdrawing from their Individual Retirement Accounts or pulling funds out of their 401(k) plans. Make sure you know about any penalties, the way this may affect on income taxes, and repayment obligation.

Ask for a gift from family. Many buyers somtimes get help with their down payment assistance from giving family members who may be anxious to help them get into their first home. Your family members may be inclined to help you reach the goal of buying your first home.

Research housing finance agencies. Provisional mortgage programs are provided to buyers in certain circumstances, like low income purchasers or future homeowners looking to renovating homes in a certain place, among others. With the help of this kind of agency, you can get an interest rate that is below market, down payment assistance and other incentives. Housing finance agencies may help you with a reduced interest rate, help with your down payment, and provide other advantages. These non-profit agencies to boost community in specific places.

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

  • Federal Housing Administration (FHA) loans

    The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), plays an important role in assisting low to moderate-income buyers qualify for mortgages. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids homebuyers in qualifying for mortgage loans. FHA helps first-time homebuyers and others who would not be able to qualify for a typical mortgage by themselves, by offering mortgage insurance to private lenders. Down payment sums for FHA mortgages are lower than those of typical mortgages, although these loans hold average rates of interest. Closing costs can be covered by the mortgage, while the down payment might be as low as 3 percent of the total.

  • VA mortgages

    Guaranteed by the Department of Veterans Affairs, a VA loan qualifies service people and veterans. This particular loan does not require a down payment, has mimimal closing costs, and provides the benefit of a competitive interest rate. While it's true that the mortgages aren't actually financed by the VA, the office certifies applicants by providing eligibility certificates.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that you close at the same time as the first. Usually the piggyback loan is for 10 percent of the purchase amount, and the first mortgage finances 80 percent. Rather than the usual 20 percent down payment, the homebuyer just has to pull together the remaining 10 percent.

  • Carry-Back loans

    We a seller carries back a second mortgage, the seller loans you part of his or her equity. The buyer funds most of the purchase price with a traditional mortgage program and finances the remaining funds with the seller. Typically, this kind of second mortgage will have a higher rate of interest.

No matter how you gather your down payment funds, the satisfaction of owning your own home will be just as sweet!

Need to talk about down payment options? Give us a call at 719-357-6601.

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