Your Down Payment

Lots of borrowers can qualify for various loan programs, but they can't afford a large down payment. Below are a few ways to put together a down payment

Reduce expenses and save. Scrutinize your budget to discover extra money to go toward your down payment. You could also try enrolling in an automatic savings plan at your bank to automatically have a specific amount from your paycheck moved into savings. Some effective ways to save additional funds include moving into housing that is less expensive, and skipping your family vacation for a year or two.

Work a second job and sell things you do not need. Perhaps you can get an additional job and build up your earnings. Additionally, you can put together a comprehensive inventory of things you may be able to sell. Unused gold jewelry can bring a good amount from local jewelry stores. Maybe you own desirable items you can put up for sale at an online auction, or household items for a tag or garage sale. Also, you can look into selling any investments you own.

Borrow funds from your retirement plan. Check the provisions of your specific program. Many people get down payment money by withdrawing funds from their Individual Retirement Accounts or taking money out of their 401(k) plans. You will want to be sure you are clear about any penalties, the way this will affect on taxes, and repayment terms.

Ask for a gift from your family. Many homebuyers somtimes get down payment help from gracious parents and other family members who are willing to help get them in their own home. Your family members may be pleased at the chance to help you reach the milestone of owning your first home.

Contact housing finance agencies. Special mortgage loans are extended to homebuyers in specific situations, such as low income buyers or future homeowners planning to renovating houses in a specific neighborhood, among others. With the help of this type of agency, you may be given an interest rate that is below market, down payment assistance and other perks. Housing finance agencies can assist eligible buyers with a reduced interest rate, get you your down payment, and offer other benefits. These non-profit programs were formed to promote the value of homes in specific areas.

Explore no-down and low-down mortgage loans.

  • FHA mortgages

    The Federal Housing Administration (FHA), which is inside the U.S. Department of Housing and Urban Development (HUD), plays a critical role in helping low and moderate-income individuals get mortgages. Part of the U.S. Department of Housing and Urban Development(HUD), FHA (Federal Housing Administration) helps individuals get FHA provides mortgage insurance to the private lenders, helping the buyers to become eligible for a home loan. Down payment sums for FHA loans are lower than those of traditional mortgages, even though these loans have current interest rates. Closing costs can be included in the mortgage, while your down payment could be as low as 3 percent of the total.

  • VA loans

    With a guarantee from the Department of Veterans Affairs, a VA loan qualifies veterens and service people. This special loan requires no down payment, has limited closing costs, and provides the advantage of a competitive rate of interest. While the mortgages don't originate from the VA, the office certifies applicants by providing eligibility certificates.

  • Piggy-back loans

    A piggy-back loan is a second mortgage that you close with the first. Usually the piggyback loan takes care of 10 percent of the purchase amount, while the first mortgage covers 80 percent. Instead of the traditional 20 percent down payment, the homebuyer just has to cover the remaining 10 percent.

  • Carry-Back loans

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

No matter how you gather down payment funds, the satisfaction of reaching the goal of living in your own home will be just as great!

Need to talk about the best options for down payments? Give us a call at 7027302085.

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