Your Down Payment

Lots of people who would like to buy a new house can easily qualify for a loan, but they can't afford a large down payment. Get started here

Reduce expenses and save. Look for ways you can trim your monthly expenditures to save toward a down payment. You may also decide to enroll in an automatic savings plan at your bank to automatically have a set amount from your paycheck transferred into savings. You would be wise to look into some big expenses in your spending history that you can do without, or trim, at least temporarily. Here are a couple of examples: you might decide to move into less expensive housing, or stay local for your vacation.

Sell things you do not really need and find a part-time job. Look for an additional job. This can be exhausting, but the temporary trial can provide your down payment money. Additionally, you can make an exhaustive inventory of items you may be able to sell. Broken gold jewelry can bring a good amount from local jewelers. Multiple small things can add up to a fair amount at a garage or tag sale. You might also explore what your investments will sell for.

Borrow from your retirement funds. Explore the details of your particular plan. It is possible to borrow money from a 401(k) for you down payment or get a withdrawal from an IRA. Make sure you comprehend the tax ramifications, your obligation for repaying funds, and possible early withdrawal penalties.

Ask for a gift from family. Many homebuyers are often fortunate enough to receive down payment assistance from giving parents and other family members who may be eager to help them get into their own home. Your family members may be happy at the chance to help you reach the milestone of buying your first home.

Research housing finance agencies. Provisional mortgage programs are extended to homebuyers in specific situations, such as low income homebuyers or future homeowners looking to improve homes in a targeted place, among others. Financing with this type of agency, you probably will receive an interest rate that is below market, down payment help and other incentives. These kinds of agencies can help you with a lower rate of interest, help with your down payment, and offer other assistance. The primary purpose of not-for-profit housing finance agencies is to boost the purchase of homes in particular areas.

Find out about low-down and no-down mortgage loan programs.

  • Federal Housing Administration (FHA) mortgage loans

    The Federal Housing Administration (FHA), which functions as part of the U.S. Department of Housing and Urban Development (HUD), plays a critical role in assisting low and moderate-income individuals get mortgage loans. An office of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) aids homebuyers in getting home financing. FHA offers mortgage insurance to private lenders, ensuring the buyers are eligible for financing. Down payment totals for FHA mortgages are less than those for traditional mortgages, even though these loans come with current interest rates. The down payment may go as low as 3 percent and the closing costs could be included in the mortgage.

  • VA loans

    Guaranteed by the Department of Veterans Affairs, a VA loan qualifies service people and veterans. This special loan requires no down payment, has reduced closing costs, and provides the advantage of a competitive interest rate. While the VA doesn't finance the loans, it does issue a certificate of eligibility to apply for a VA loan.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that closes with the first. Often the first mortgage covers 80% of the cost of the home and the "piggyback" is for 10%. The homebuyer covers the remaining 10%, instead of come up with the usual 20% down payment.

  • Carry-Back loans

    In a "carry back" mortgage, the seller commits to lend you a portion of his own equity to help you get your down payment money. The buyer funds most of the purchase price with a traditional mortgage program and finances the remaining funds with the seller. Typically you will pay a somewhat higher interest rate with the loan financed by the seller.

The satisfaction will be the same, no matter how you manage to pull together your down payment. Your new home will be well worth it!

Need to talk about your down payment? Give us a call at (321) 777-7277.

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